Declining Labor Participation Was Predicted, And It Has A Perfectly Good Explanation

[History_Buff]

I really don't think that's what he's saying at all. This thread has it's roots in another where people were essentially postulating that the only reason that unemployment was decreasing was because people were dropping from the labour force.

I believe the OP's argument is not that everyone who left the labour force did so because they retired, but that many people left the labour force because they were retired. The conclusion being that the decrease in unemployment isn't solely due to working age people leaving the work force.

There definitely are working age people leaving the work force (personally I'm curious to see what the stats on education program enrollment is), but a significant number of those leaving the work force are no longer of working age.


Note: I'm not using working age in any technical sense here, it's just my way of saying 'people who are old and want to retire'.

 

[Theige]

I really don't think that's what he's saying at all. This thread has it's roots in another where people were essentially postulating that the only reason that unemployment was decreasing was because people were dropping from the labour force.

I believe the OP's argument is not that everyone who left the labour force did so because they retired, but that many people left the labour force because they were retired. The conclusion being that the decrease in unemployment isn't solely due to working age people leaving the work force.

There definitely are working age people leaving the work force (personally I'm curious to see what the stats on education program enrollment is), but a significant number of those leaving the work force are no longer of working age.


Note: I'm not using working age in any technical sense here, it's just my way of saying 'people who are old and want to retire'.

Yes. This is the point of the OP

It's plain as day in the third chart. 2/3 of the drop in the labor participation rate is "people who do not want a job." The vast majority of those people are over 55.

The other 1/3 of the drop in the labor participation rate are "people who want a job."

That is, people who aren't in the labor force because they stopped seeking employment, but would like to be employed.

 

[pi-r8]

Yes. This is the point of the OP

It's plain as day in the third chart. 2/3 of the drop in the labor participation rate is "people who do not want a job." The vast majority of those people are over 55.

The other 1/3 of the drop in the labor participation rate are "people who want a job."

That is, people who aren't in the labor force because they stopped seeking employment, but would like to be employed.

Well in the third chart it says the labor participation rate went down 2.1%, and only 0.8% of that (about 1/3) was growth in people over 55 who don't want a job. So to me that suggests that only 1/3 of the fall in labor participation can be attributed to "benign" retirement, and the rest is people going back to school or just giving up.