Record 94 Million Americans Not In The Labor Force; Participation Rate Lowest Since 1977

Zero Hedge ^ | 09/04/2015 | Tyler Durden

[SeekAndFind]

While the kneejerk headling scanning algos are focusing on the seasonally-adjusted headline monthly NFP increase which came in a worse than expected 173K, the presidential candidates - especially the GOP - are far more focused on another data point: the labor force participation rate, and the number of Americans not in the labor force. Here, they will have some serious ammo, because according to the BLS, the main reason why the unemployment rate tumbled to the lowest since April 2008 is because another 261,000 Americans dropped out of the labor force, as a result pushing the total number of US potential workers who are not in the labor force, to a record 94 million, an increase of 1.8 million in the past year, and a whopping 14.9 million since the start of the second great depression in December 2007 while only 4 million new jobs have been created.

 

And since there are still those confused why wages so stubbornly refuse to rise, here is our favorite labor-related chart, showing the annual increase in average hourly wages superimposed next to the US civilian employment-to-population ratio, which remains solidly below 60%, and has barely risen since the great financial crisis.

[skeeter]

Meanwhile the toads in the network news are reporting the great now unemployment figure.

Roll out the barrel!

[nascarnation]

There are plenty of jobs available here in Indiana.
But they are single digit per hour wages and 29er hours without benefits.
I suspect a lot of folks can do better on the dole.

[SeekAndFind]

RE: But they are single digit per hour wages and 29er hours without benefits.

What if we did away with the Obamacare mandates? Would that help?

[Steely Tom]

Apparently, these 94 million who have “dropped out of the labor force” are counted as “employed” under Obama million man math.

[nascarnation]

I suspect it would.
But doing away with OBAMA would be even better!

[proxy_user]

So, how many people should be in the labor force? What is the appropriate number of college and grad students, housewives, and early retirees?

[GeorgiaDawg32]

Yes, but unemployment is down to 5.1%.

Just wait until everyone falls off into the bit bucket. With no one working, unemployment will be 0.0%.

[FlingWingFlyer]

Why work when the government will take care of you?

[IMR 4350]

The economy is so good 94 million no longer have to work.

In other news, the free soup at the soup kitchen is so good thousands line up and wait for hours just to get a bowl.

[grania]

What you asked made me think about why I'm now a totally-retired retiree. It's a total equation....the work, reward and safety, the hours, the commute, the wages. I wonder if a lot of those slipping out of the job market are retirees who have decided that it's not worth it.

If interest on FDIC savings reaches even a somewhat reasonable percentage (say 3%?) I'd wager that a lot more older folk would leave the workforce and open jobs for younger workers. Just a guess, based on my experience and what I know of those whom I encounter.

[rktman]

Hmmmmm. Didn’t someone say in Milwaukee a while back: “There isn’t a single segment of the economy that isn’t better off today than when I took office.!” Maybe it’s been a year. Not sure when the lyin’ king uttered that particular lie but there are so many it’s hard to keep up. So I don’t even listen to the whissssstler. Actually, I’ve managed to avoid listening to anything he’s had to say since the first (s)election cycle.

[Zakeet]

[TomGuy]

No wonder that the UE has fallen to 5.1%.

More BLS fun-with-fudging-numbers.

[Marko413]

I’ve been saying this for years in contrary to the unemployment numbers. When I used to live in an apartment and take a day off, I was always stunned by the number of cars still parked around neighborhoods and apartment complexes. I have no problem with anyone staying at home to take care of children or folks taking a sick/vac day like I am doing at that moment. But when you see roughly the same amount of cars in the apartment parking lot from evening, morning, and during the day, you realize that only a half dozen people in the whole complex are actually working throughout the day. My roommate and I were convinced everyone was dealing drugs because of all the fancy cars that were in the parking lot. It wasn’t until years later i realize just how much “low income” people were getting from the government.

[Mastador1]

Why work when the government will take care of you?

How many people have been forced into that position by Lord Foul, with hours cut and insurance mandated how the hell do you pay your basics and pay for his friggin insurance. I know more than a few people struggling right now who can barely make it, they look at all the illegals on the dole with anchor babies and subsidized housing and wonder why they even bother.

[Steven Scharf]

“So, how many people should be in the labor force? What is the appropriate number of college and grad students, housewives, and early retirees?”

You present an interesting question.

If you go to the BLS data site and pull up the info going back to 1948 (I presume when they started to keep track of this info) it show a different chart than the one presented above. It fluctuates from 58% to 60% from 1948 to 1972 when it begins to slowly rise 66.8% at the beginning of 1990. It then floated in the 66% level until 2002 when it starts to come back down to 62.6% today.

http://data.bls.gov/pdq/SurveyOutputServlet

The reason the number seems so massive today is that there are 100 million more people in America than 1980.

Prior to 1972 it was not as common for women to be in the job market. Their movement into the job market increased the participation rate. It would be interesting to see the male vs female participation rate. Not sure if it is broken out. The data page does not appear to allow this.

[mountn man]

If interest on FDIC savings reaches even a somewhat reasonable percentage (say 3%?) I'd wager that a lot more older folk would leave the workforce and open jobs for younger workers.

I remember in the late 70's bank account and cd interest was really good.

Of course mortgages were double digit.

And inflation was huge.

[mountn man]

When he comes on the tv or radio I instantly change the channel or turn it off.

No politician has so enraged me.

[jwalsh07]

Depends. How many other people do you want to support?