Thursday, December 19, 2013

Labor Force Participation Rate Expected To Decline Over Next Decade: BLS

From Bureau of Labor Statistics, Monthly Labor Review, December 2013, "Labor force projections to 2022: the labor force participation rate continues to fall:"

Labor Force Participation Rate
Source: Bureau of Labor Statistics
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Labor force participation rate
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The labor force participation rate—the proportion of the civilian noninstitutional population in the labor force—is typically lower for 16-to-19-year-olds in comparison to other age groups, but it increases during the prime working years and then declines sharply after age 55 as workers leave the labor force. The labor force participation rate is a major indicator of the state of the labor market. Changes in the overall and detailed age, gender, race, and ethnic labor force participation rates are the result of a combination of factors, including changes in the demographic composition of the population as well as cyclical and structural changes in the economy. Each of these factors affects labor force participation rates in various ways. The demographic composition of a population reflects the shares of men, women, and the different age, race, and ethnic groups within that population. The aging of the baby-boom generation is an example of a demographic change affecting the labor force participation rate. In 2000, baby boomers were ages 36 to 54 and were in the prime age group, with the highest participation rates. Every year after 2000, a segment of the baby-boom population has shifted into the 55-years-and-older age group, moving from the prime age group to one with much lower participation rates, causing the overall participation rate to decrease. (See table 3 [omitted].) This trend is expected to continue and even accelerate in the 2012–2022 timeframe.

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