Employ America
@employamerica
Strategies for a full employment economy that delivers durable, inclusive prosperity.
Team: @IrvingSwisher @ArnabDatta321 @ash_georgexx @PrestonMui @_vikasbp
706 Following 6.1K Followers
The rapid declines we have observed over the past year don't seem to be representative of any local, cyclical weakness in the labor market.
This is one reason why we are less alarmed about the latest jobs report, and are leaning more on the fact that u3 has declined and remains low. Holding the age composition of the CPS fixed has little effect on the unemployment rate trends over the past few years.
Show more
This has been a drag on overall labor force participation since the 65+ labor force participation rate is just under 20%, while the 60-64 rate is just under 60%.
A large part of the reported decline in participation since last year happened because of the discontinuous jump in the 65+ population share in January. Since January, the 65+ population weight has continued to rise as the 60-64 population share shrinks.
Show more
The Census Bureau adjusts the Current Population Survey weights annually every January, and does not readjust past data to account for those weights. This causes abrupt jumps in the CPS demographic weights of the CPS every January.
Show more
The aging of the population is a long-term, secular trend, so how can it cause such a rapid decline in the population trends?
Taking a look under the hood, ~2/3 of the decline can be explained by changes in the population weights.
Most of the remaining decline is due to lower participation rates amongst older workers -- especially for the 65+ cohorts.
Show more
There has been a lot of concern and debate regarding the decline in the labor force participation rate. @PrestonMui breaks it down.
