As Mike Konczal noted this morning, a key indicator of labor recession is still in force: if you’re unemployed, you’re still more likely to drop out of the labor force entirely than you are to find a job.Let's see how that trend has fared over the longer term.
The chart below shows the ten year rolling change in the number of individuals employed divided by the ten year rolling change of those individuals no longer in the labor force. Any number over 1 means that the marginal person of working age is more likely to have gotten a job ten years later than to be out of the labor force.
In the late 1980's / mid 1990's, this marginal individual was a whopping 8x more likely to have found a job than no longer be looking. Today? 0.35x, which means that the marginal individual of working age (relative to 2002) is 3x more likely to be out of the labor force, than to have found a job.
Source: BLS
Another most interesting graph.
ReplyDeleteCould the trend here have anything to do with demographics? With the aging of baby-boomers?
Not in labor force only accounts for those in the working age population and (I believe) the average baby boomer is actually working more, not less.
ReplyDeleteThe bulk of the Boomers have yet to retire. The leading edge that have fixed pension have started. Those with 401ks have reduced resources & are opting for more working years. The peak Boomer birth year was 1961. The peak retirement year is 2026 - still a few years off. Boomers are entering the stage of lower spending and higher saving. That reduces consumer demand and the related need for employees in most all supply chains. The number of jobs is shrinking due to lower demand. It will begin to change in another 10 years.
ReplyDeleteSome good info on this topic from Calculated Risk can be found here: http://tinyurl.com/89xx4f2
ReplyDeleteA recent report came out and it was not pretty. Low wage jobs made up 42% of all jobs created.
ReplyDelete