I want to push back against this post by Arnold Kling suggesting that the macroeconomy is a myth.
A macroeconomist would argue that structural unemployment always exists. It represents a sort of background noise. Models that assume a single aggregate labor market are only approximations, and if the economy acts as if there were a homogeneous labor market, then this approximation causes no more harm than any other simplifying assumption in economics.
It’s an empirical question. My view is that the variation across sectors and occupations is more dramatic and important than the variation within sectors, even for the period 2007 to the present. That is, for some fairly large categories of workers you will see a higher unemployment rate in 2007 than for other categories in 2011, because the structural factor swamps the supposed aggregate-demand factor.
The last statement is flat obviously true.
The question is what about that co-movement. Or to put it another way look what happens when allow for different scales
See how tight they are. Even the divergence that is there is generated by the sectoral shift towards manufacturing that I pointed to in another post.
I like to phrase the question this way: Are movements in the unemployment rate representative of the general trend in unemployment or the unemployment trend in general.
I think the evidence points towards the former.