by Bill McBride on 9/03/2011 08:01:00 PM
Saturday, September 03, 2011
Note: I've updated the percent job losses in recession graphs. With an earlier BLS revision, the peak of employment moved to January 2008 instead of December 2007. This matters if we are counting the number of months below the previous peak. (ht Scott)
By request, here is an update to several participation rate graphs. Here is a look at some the long term trends (updated graphs through August 2011).
The following graph shows the changes in the participation rates for men and women since 1960 (in the 25 to 54 age group - the prime working years).
Click on graph for larger image in graph gallery.
The participation rate for women increased significantly from the mid 30s to the mid 70s and has mostly flattened out this year - the rate increased slightly in August to 74.7%. The participation rate for men has decreased from the high 90s a few decades ago, to 88.7% in August 2011. (up slightly from July).
There will probably be some "bounce back" for both men and women (some of the recent decline is probably cyclical), but the long term trend for men is down.
The next graph shows that participation rates for several key age groups.
There are a few key long term trends:
• The participation rate for the '16 to 19' age group has been falling for some time (red). This was at 34.5% in August.
• The participation rate for the 'over 55' age group has been rising since the mid '90s (purple), although this has stalled out a little recently (perhaps cyclical). This was at 40.2% in August.
• The participation rate for the '20 to 24' age group fell recently too (perhaps more people are focusing on eduction before joining the labor force). This appears to have stabilized - although it was down to 70.5% in August, from 71.5% in August 2010, and I expect the participation rate to increase for this cohort as the job market improves.
The third graph shows the participation rate for several over 55 age groups. The red line is the '55 and over' total seasonally adjusted. All of the other age groups are Not Seasonally Adjusted (NSA).
The participation rate is generally trending up for all older age groups.
Eventually the 'over 55' participation rate will start to decline as the oldest baby boomers move into even older age groups.
I've been expecting some small bounce back in the overall participation rate, but I don't think the bounce back will be huge - and we haven't seen it yet. The overall participation rate increased slightly in August to 64.0% from 63.9% in July (the lowest rate in almost 30 years).
• Summary for Week ending September 2nd (with plenty of graphs)
• Schedule for Week of September 4th
• August Employment Report: 0 Jobs (unchanged), 9.1% Unemployment Rate
• Employment Summary, Part Time Workers, and Unemployed over 26 Weeks
• Duration of Unemployment, Unemployment by Education and Diffusion Indexes
• Employment graph gallery