This week in Trumponomics: Labor Force Participation Rate Still Low

Yahoo Finance ^ | 05/04/2018 | Rick Newman

[SeekAndFind]

President Trump is proud of the 3.9% unemployment rate, the lowest since 2000. But it’s not as great as it sounds.

Employers added 164,000 jobs in April, which was lower than forecasts but still okay. Employers have created an average of 200,000 new jobs each month so far in 2018, which is a strong pace of job growth. But the unemployment rate, which fell from 4.1% to 3.9%, is a puzzlement. There were fewer people looking for jobs in April, which means fewer people counted as unemployed. When unemployment falls because people get jobs, that’s good. But when unemployment falls because people give up looking for jobs, it’s not so good.

For that reason, our weekly Trumpometer says: MEDIOCRE.

Economists struggle to explain two oddities in the current labor market. The first is the relatively low portion of working-age Americans who have a job or are looking for one. The so-called labor-force participation rate is 62.8%, a level it has generally been stuck at since 2014. The peak was 67.3% in 2000. So while the unemployment rate is back to the low levels of 2000, the portion of Americans working or looking for work is considerably lower.

An aging labor force might explain part of the problem, since workers aged 55 to 64 — a bracket that is swelling, as the baby boomers age — are less likely to work than younger folks. The opioid epidemic might keep some people who would otherwise have a job from working. Recent research from the Conference Board suggests more people consider themselves disabled these days, a third possible explanation for the low participation rate.

The other oddity is weak wage growth, with wages rising just 2.6% during the last 12 months. Ordinarily, employers hike pay as unemployment drops and workers become scarce.

[kaehurowing]

Every job done by an illegal takes away a job that could be done by an American.

[DannyTN]

Looking at the labor force participation is valid.

• If labor participation is low because people have become independently wealthy and can retire early, that's a good thing.
• If participation is low because people got on disability in 2009 to survive even though they aren't disabled, and now they are afraid or unwilling to reenter the workforce, that's a bad thing.

[<1/1,000,000th%]

Fake news.

[Nifster]

You flat statement about all the new jobs going to illegals is false and unsupported by any sourcing

[kaehurowing]

You flat statement about all the new jobs going to illegals is false and unsupported by any sourcing

---

“All Employment Growth Since 2000 Went to Immigrants”

https://cis.org/All-Employment-Growth-2000-Went-Immigrants

[EC Washington]

Lot of illegals working for cash that is not reported. Go to any truck dock in an urban area, there are ATM’s available on the dock to pay “lumpers” in cash to unload your truck. Big companies are looking the other way at the lumper practice so they don’t have to hire full time workers.

[WilliamCooper1]

I don’t recall one article going this in depth when the unemployment reports came out under Obama.

[WilliamCooper1]

I was unemployed for a year, from Oct 2015 to Nov 24 2016. I got an email out of the blue from a random guy that ran across my resume.

[Zathras]

If my ex wife can find a job, anyone can!
It all broke loose back in October for her.
:-)

[catnipman]

ROTFLOL!

for 8 year under obamam the leftist fake stream media pretended like the U6 unemployment stats didn’t exist, but now that Trump is President, they’ve suddenly discovered theM: “Oh look, things arn’t REALLY as rosy as Trump claims ...”

Of course, the thing is that the leftist fake steam media can spin numbers all day long, but it’s the reality of daily life that people are going to pay attention to, not the lies and spin from the Nuevo Pravadas from the right-hand coast ...

[kaehurowing]

Here’s another example. Watch any of the home improvement or rehab project TV shows that are shot in the U.S. (HGTV, e.g.). You will see they film them so they never show the workers’ faces or sometimes they even get blurred out. It’s because all the construction workers they use are illegals.

[Nifster]

Nice try. Dated 3014 which was during Obozo years

What has happened in the last 18 months? I know for a fact coal miners are back to work

[cpdiii]

There are jobs out there to be had if one wants to work be it menial back breaking labor (I did this as a young man before becoming educated). These jobs range from menial to high tech and science. The jobs are there.

Today if one is not working it is due to the fact one has worked long and hard and wisely and no longer needs to work. The others that do not work and do not need to work are those that choose to and live off social welfare programs. They have chosen a miserable life but they chose it. I have no sympathy for them.

We live in the greatest nation on earth that will allow anyone to become anything they want to be.

[EC Washington]

Visit any Wooden Pallet yard in the US and try to find a US Citizen in the hourly work force. Good Luck. ICE could shut down the entire pallet industry in a day.

[kaehurowing]

That was my point. Obama didn’t create a single job, although he claims all credit for the “recovery.” All the jobs went to immigrants, none to Americans who were laid off and sucked wind during Obama.

[Hugin]

An aging labor force might explain part of the problem, since workers aged 55 to 64 — a bracket that is swelling, as the baby boomers age — are less likely to work than younger folks.

I've been saying that for a while. A lot of boomers who work physical jobs can't do them anymore.

[buwaya]

This is real, not fake, and I have been following this for 20+ years.

They rarely mentioned this in the Obama years, for good reason of course, but that does not mean the problem isn’t still here.

[buwaya]

“What labor statistics sometimes tell you is that some labor statistics are meaningless. This “Labor Force Participation Rate” is one of them.”

This is not at all meaningless.
The better one is the Population Employment Rate, which is good for International comparisons unlike the unemployment rate.

The article is legit. The needle hasn’t really moved on either the Participation rate or the Population Employment rate.

[buwaya]

This is the best comparable data series.

Population-employment ratio, ages 25-54 (prime working age)

https://fred.stlouisfed.org/series/LNS12300060

Upshot - Its been a very long slow recovery since 2008. Trump has not yet had a significant effect on the rate of improvement. Its all continued to improve, but no miracle, and there is a significant way to go to hit the peak, in 1999-2000.

More interesting maybe is the same, ages 16-24

https://fred.stlouisfed.org/series/LNS12300012

This is fascinating. The peak here was way back in 1978. There has been a very long term decline in the rate of kids working. I suspect its so many of them in college.

[Nifster]

Ahhhh now I understand. I thought you were talking about the Trump jobs

I’m clear now. Sorry for the misunderstanding