There was some good news in this morning’s Employment Situation Report. The economy added 161,000 new jobs in October—enough to bring in players off the bench. Perhaps most significantly, nominal wage growth increased 2.8 percent over the year, another step-up over the pace of growth in recent years and a sign of a tightening labor market, where workers may be starting to gain some leverage. All in all, last month was a solid step closer to full employment, but we still have not reached it yet. It’s important to remember that these positive highlights don’t mean we are at full employment. That’s why the Federal Reserve made the right decision to leave rates alone earlier this week. The economy continues to move in the right direction, but considerable slack remains and the recovery has yet to be fully realized in all parts of the economy or for all workers.

This month and this year, the economy has hit some milestones, but I’d argue that those are relatively low bars for success. For example, for the first time this recovery, the prime-age employment-to-population ratio (EPOP) exceeded its low point of the last two business cycles. As seen in the figure below, prime-age EPOP hit 78.2 percent in October, just surpassing its level in February 1993 of 78.1 percent. Is it good that the prime-age EPOP is rising? Yes, but, prime-age EPOPS remain below the low point of the last recession, let alone levels that could constitute a full employment economy. That’s what I mean by a “low bar.” But, the uptick last month is a good sign and I look forward to continued progress on this key measure.

Moving on to the unemployment rate, which has sat at, or near, 4.9 percent for much of the last year. As the labor force continues to pull in more entrants (or re-entrants), the unemployment rate has remained fairly steady as many of those coming off the sidelines are actually finding jobs. But, the overall unemployment rate masks important differences for demographic sub-groups. In the figure below, I show the unemployment rate for white, black, and Hispanic workers separately. In both peaks and troughs, the black unemployment rate is consistently higher than Hispanic and white unemployment. This year, the black unemployment rate has finally ducked below where the white unemployment rate was at its peak in the aftermath of the Great Recession. Like I said, a low bar, but it’s progress. But, this is why the economy needs to reach full employment. Only then, will such progress be exhibited in better jobs and higher wages for workers across the economy.

If we were handing out participation medals, sure, the economy would get one. The labor market is certainly in the game, but it isn’t going to get any awards just yet. The good news is that the economy is clearly solidly on the path to full employment. If it’s allowed to keep chugging along this path, it should get there, so long as policymakers do not get in the way. We know that policy mistakes have made a full employment recovery so slow in coming. Austerity at all levels of government has not only depressed government employment, but has kept full employment out of reach for far too long. So far, the Fed has been mostly admirably mistake-free— and made a wise decision this week to keep rates unchanged to give the recovery more room to run. They should keep modeling good policy behavior for the next president. And, maybe Congress will not just stop making bad mistakes on fiscal policy, but will also try to be actually useful. Investments in much-needed physical and human capital infrastructure would not only be a short-term boost, but would also support the long-run health of the economy.