Trendsin LaborForce ParticipationLaborforceparticipationrate100%90Men80706050Women4030201001948195819681978198819982008The labor forceparticipationrate of adult men hasFigure 9.3declined gradually since 1948...Trends inthelaborforce:participation... but it has increased significantly for adultrates of adult men andwomen, making the overall rate higher today thanwomensince1948it was then.@2015PearsonEducation,lnc
© 2015 Pearson Education, Inc. 11 Trends in Labor Force Participation The labor force participation rate of adult men has declined gradually since 1948. . but it has increased significantly for adult women, making the overall rate higher today than it was then. Trends in the labor force: participation rates of adult men and women since 1948 Figure 9.3
MakingIs Falling LaborForce ParticipationBad?theConnectionPoliticians often like to point toLaborforcea“falling labor forceparticipationrateparticipation rate" as a strongly100%90negative sign for the economy.Men8070. Is this necessarily true?605040The two major reasons why30theLFPRformenhasfallen20overthelastseveraldecades10oare:1948195819681978198819982008 Men have been going to school forlonger and retiring earlierthan before (why?)Increases inSocial Security Disability Insurance availabilityhaveallowedpeoplewithdisabilitiestostop workWhetherthese are good or bad is a value judgment.122015PearsonEducation,Inc
© 2015 Pearson Education, Inc. 12 Making the Connection Is Falling Labor Force Participation Bad? Politicians often like to point to a “falling labor force participation rate” as a strongly negative sign for the economy. • Is this necessarily true? The two major reasons why the LFPR for men has fallen over the last several decades are: • Men have been going to school for longer and retiring earlier than before (why?) • Increases in Social Security Disability Insurance availability have allowed people with disabilities to stop work Whether these are good or bad is a value judgment
UnemploymentRatesforDifferentGroupsUnemploymentByeducational levelBy ethnic grouprates16%14121086420AsiansWhitesHispanicsAfricanHighHighCollegeschoolschoolAmericansgraduatesdropoutsgraduatesUnemployment rates vary by ethnic group...Figure 9.4... and byeducationlevel.Unemploymentrates in theThesetwoobservations arestatisticallyUnited States,related.August 201313@2015PearsonEducation,lnc
© 2015 Pearson Education, Inc. 13 Unemployment Rates for Different Groups Unemployment rates vary by ethnic group. . and by education level. • These two observations are statistically related. Unemployment rates in the United States, August 2013 Figure 9.4
HowLong ArePeopleTypicallyUnemployed?Long periods of unemployment are bad for workers, as their skillsdecay and they risk becoming discouraged and depressed.: During the Great Depression of the 1930s, some people wereunemployedforyearsatatimeSince World WarAveragelengthofIl, averageunemployment(weeks)lengths of45unemployment40havebeen3530relatively low, but25that changed20dramatically with15the2007-200910recession.196519851950195519751995200520102015PearsonEducation,Inc.14
© 2015 Pearson Education, Inc. 14 How Long Are People Typically Unemployed? Long periods of unemployment are bad for workers, as their skills decay and they risk becoming discouraged and depressed. • During the Great Depression of the 1930s, some people were unemployed for years at a time. Since World War II, average lengths of unemployment have been relatively low; but that changed dramatically with the 2007-2009 recession
MakingTheEmploymentSituationFollowingthe2007-2009RecessiontheConnectionEmployment-populationratio65%646362616059585756555419501955196519751985199520052010The fall of the employment-population ratio may give an evenbetter indication of how weak the U.S. labor market was duringand afterthe2007-2009 recession.Explaining these changes is a top priority for labor economists.15@2015PearsonEducation,lnc
© 2015 Pearson Education, Inc. 15 Making the Connection The Employment Situation Following the 2007-2009 Recession The fall of the employment–population ratio may give an even better indication of how weak the U.S. labor market was during and after the 2007–2009 recession. • Explaining these changes is a top priority for labor economists