Covered at Reason 24/7: Falling Labor Participation Drives Improved Unemployment Rate

Have you heard? Unemployment is down? Well, it's down-ish. Actually, if the labor force participation rate was still at the same level it held before the recession popped everybody's balloons, unemployment would stand at a not-so-encouraging 10.7 percent. The official unemployment rate of 7.7 percent comes, in part, courtesy of the large numbers of Americans who are so discouraged that they've stopped even looking for work. That doesn't mean that jobs aren't being created, but it does mean the economy still has a bit of a limp.

From Investors Business Daily:

Employers created a surprisingly large number of jobs in February, but it wasn't strong enough to prevent many Americans from leaving the workforce.

Nonfarm payrolls grew by 236,000, the Labor Department said Friday, well above forecasts of 171,000. The unemployment rate dropped to a 4-year low 7.7%, beating expectations for a smaller dip to 7.8%.

But some of that improvement was due to fewer people looking for work. The household survey that determines the jobless rate found that 170,000 more people were working, while 130,000 dropped out.

The labor participation rate fell to 63.5% from 63.6%, returning to the low reached last summer and matching the lowest level since 1981. If it had stayed at the pre-recession rate of 66%, unemployment would be 10.7%.

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Comments

[Marshall Gill]

Unpossible!

[SumpTump]

dude is talking a lot of smack

http://www.EliteAnon.tk

[Fist of Etiquette]

I think technically that's trash not smack.

[jesse.in.mb]

Since when can you not talk smack?

[Episiarch]

Since he got out of rehab.

[AlmightyJB]

Well he had an excuse when he was in rehab. Now that he's out though...

[Brutus]

See, all the more reason we need to follow Father Obama in raising taxes and passing jobs bills. /prolodyte

[John Galt]

Michelle and Barack are our nation's mother and father. We have to do whatever they desire.

[Fist of Etiquette]

It never works out well when your dad is also your boss.

[John Galt]

...and your Owner. Barack is both President and Baal all rolled into one neat and compact package.

[John Galt]

Statistics are basically baloney. With a little tweaking most parties can produce the stats they desire.

[Hugh Akston]

Oh, Kent, I'd be lying if I said my men weren't committing crimes.

[John Galt]

Yes, Clark Kent, I've heard of him. He's a reporter over at the Daily Planet.

[pmains]

So, they're using the pre-crash labor participation rate. How about what the labor participation rate would be expected to be given the changes in demographics that have happened since the crash happened 5 years ago?

[Mike M.]

The only demographic that really matters is the fact that our population is growing constantly. The baby boomers retiring isn't all that relevant; if they were so important and productive they would be getting replaced.

[Killazontherun]

The crash caused a severe lowering of immigration, so accounting for that in labor participation would show that in even worse light.

[Sudden]

As much as I don't doubt that part of the decline in unemployment is the decline in the labor participation rate of people who would otherwise seek work, it is worth noting that 2008 did correspond to the first year of Boomers hitting retirement age.

I'd like to see this graph controlled for retirees.

[db]

I agree that there should be some sort of Boomer retirement effect, but anecdotally, I work with a bunch of Boomers of retirement age who have no desire to retire. These are folks in their mid 60s who have a high level of job satisfaction and see themselves working for another 5-10 years.

They're basically daring their employers to let them go so they can file an age discrimination suit.

[HazelMeade]

I believe that LFP is defined as people *of working age* who are in the labor force. So as the baby boomers hit 65 or 67 or whatever that is they should no longer be included in the working age population.

However, it's possible that some are getting laid off and retiring early.

[Sudden]

The link for the BLS site shows the only age criteria as 16 years and older. Granted, they may be removing those who categorize themselves as retired, but it's unclear there.

[Sevo]

Hey, I'm older than 16 and I'm still working.

[VG Zaytsev]

it is worth noting that 2008 did correspond to the first year of Boomers hitting retirement age.

The baby boom started in 1948 not 1943.

And liver births in the late 90s were higher than they were in the late forties. So more people should be aging into the workforce than leaving it through retirement.

[BuSab Agent]

What the hell is a liver birth? Maybe I don't want to know...

[LTC(ret) John]

Did you ever see Alien....?

[Sudden]

Technically, it started in 46, and in 2008 the first Boomers born in 46 were eligible for SS bennies at the discounted early retirement rate. I know because my Dad was one of them (although he retired in 2010).

[Red Rocks Rockin]

The labor force participation rate is the rate of the entire actual labor force, not the employment to population ratio.

The former is here:
http://data.bls.gov/timeseries/LNS11300000

The latter is here:
http://data.bls.gov/timeseries/LNS12300000

Note that in the latter, the rate has climbed ever so slight from the lows. That's baby boomer retirements. In the former, however, we're bouncing along the bottom.

[AlmightyJB]

Need more stimulas.

[HazelMeade]

I'm wondering if the fall in the LFP rate is due to baby boomers retiring early.

[Palin's Buttplug]

Anyone can find work that wants to.

[Some call me Tim?]

But with 99 weeks of unemployment checks, and few jobs to replace your previous income...why would you?

[Gene]

Because work is good for you.

[OldMexican]

onfarm payrolls grew by 236,000, the Labor Department said Friday, well above forecasts of 171,000. The unemployment rate dropped to a 4-year low 7.7%, beating expectations for a smaller dip to 7.8%.

I know that many Obama supporters are sanguine about these numbers, but if you look at the breakdown by the type of jobs, the scenario is much less rosy:

According to the BLS, 48,000 were construction jobs (the result of the stimulus effect of cheap Fed money); 23,700 retail jobs (hard to believe when nobody has money); 20,800 in the movie-making industry (???); 10,900 accounting and bookkeeping; 21,000 temporary support jobs; 39,000 for the healthcare business and 18,000 waitresses and bartenders. Nothing about new manufacturing jobs or making real things.

So while the big number may impress the clueless leftist hack, it certainly does not impress me one bit.

[Romulus Augustus]

Had a prog tell me today, with a straight face, that drop in labor participation was a good thing because it meant breadwinners' lot was improving so their second income spouse could quit their lousy job. The richer the nation, the fewer need to work!

[John Galt]

ROTFLMAO

[Mike M.]

Who the fuck do these lefty scumbags think they're kidding? Median household income in this country has declined four years in a row, and it hasn't moved one inch since 1996.

[Red Rocks Rockin]

Right, which is why the number of people with multiple jobs went up last month while those with just one job went down.

You should have just asked him how boot leather actually tastes.

[Ken Shultz]

I'd love to see Rand Paul propose a comprehensive bill to address structural unemployment right about now.

He could start with slashing all sorts of unnecessary regulations, and cap it off with a proposal to raise the ObamaCare tax exemption on firms with less than fifty employees to those with less than a thousand.

Yeah, I'd rather get rid of the whole damn thing, too, but it would never pass the Senate anyway, and the idea is to get the Obama Administration and their supporters on the record as being against bringing down the unemployment rate so long as that also means chipping away at ObamaCare.

Obama doesn't care about the nation's unemployed--he just cares about his legacy! ...you know the drill.

[Hyperion]

courtesy of the large numbers of Americans who are so discouraged that they've stopped even looking for work

Some of them get even more discouraged once they figure out that they can live high on the hog off total state assistance. Why work when you can just stop working and have others support you, and you have a lifestyle better than when you were working, without lifting a finger?

[Night Elf Mohawk]

Some of them get even more discouraged once they figure out that they can live high on the hog off total state assistance.

Is there a website that tells how to do this? I think I might as well get back some of the money now that I paid into SS before it goes away.

[Archduke Pantsfan]

News you can use: How to get drunk in public

[Hyperion]

Just don't do it in Murika, and no problems...

[John Galt]

I'm too terrified to even attempt drinking in public. Looking forward to seeing our pot smoking brethren get their taste of the same. Especially since they were so quick to jump on the let's crucify the drinkers bandwagon.

😀 😀 😀

[Apatheist ?_??]

Really? I've never been worried about drinking in public. I thought the article was common knowledge, just don't draw attention to yourself. Hell I've smoked in public too, as shitty as the police are they aren't everywhere.

[KDN]

Sometimes that's not even enough. Once I was on my way to a Yankee game and was yanked off a train for brown bagging a 40 of OE. It wouldn't be so bad except NYC makes you actually go to court for their $25 open container violations.

[Dweebston]

Oh, Slate. You're so... wait, useless, unfunny, and no unintentional, oblivious humor? 0/3.

[mr lizard]

Just put a can of Tecate in a coozy. Then it looks like a can of Coke

[Bam!]

Though unlike Utah, Mars will eventually be made liveable.

[widget]

That doesn't mean that jobs aren't being created, but it does mean the economy still has a bit of a limp.

Jobs are being destroyed. I've been doing this every workday for 25 years. I am an automation engineer. My job is to end yours.

Eh, but it doesn't really work that way. I know of no one who has ever been been layed off, offered early retirement, or fired as a result of my work. No one. I get very focused on doing the task at hand so I'm not sure I see the big picture. But I know this, the goal posts keep moving. They don't get closer.

[darius404]

I am an automation engineer. My job is to end yours.

The most beautiful thing I've read all day. Go forth and crush lives! BWAHAHAHAHAAAAA!!!!

[Hyperion]

The goal of all automation engineers should be one and one only. Develop and deploy an army of life like fembot sex slaves to serve their libertarian masters. Until that goal is realized, it's STFU and get back to work!

We didn't even get our flying cars yet, for fucks sake, if we don't get artificial pussy soon, there's going to be a jihad!

[LTC(ret) John]

I will follow your banner, Hyperion!

[Hyperion]

Jobs aren't being destroyed by automation.

Jobs are being destroyed by the Obamanation.

Has there ever been an administration that shows such open hostility to small business? You didn't build that? What president before now could have ever said anything like that and still won re-election?

We're totally screwed. 50% of voters are below retard intellect level. What could be expected when you encourage people that sloth is to be rewarded, while success is to be punished?

[Paul.]

Why not give the administration their good jobs numbers? I say we allow the low information voter to come away thinking that Sequester = Jobs growth.

[mr lizard]

Meanwhile your automation keeps me employed because I know how to over ride it when some stupid sensor shits out and I need to keep the ship moving. 30% of my job is spent defeating all that computerized bullshit.