Declining Labor Force Attachment and Downward Trends in Unemployment and Participation (Paperback) (ISBN-13: 9781503223684)

The US labor market witnessed two apparently unrelated secular movements in the last 30 years: a decline in unemployment between the early 1980s and the early 2000s, and a decline in participation since the early 2000s. Using CPS micro data and a stock flow accounting framework, we show that a substantial, and hitherto unnoticed, factor behind both trends is a decline in the share of nonparticipants who are at the margin of participation. A lower share of marginal nonparticipants implies a lower unemployment rate, because marginal nonparticipants enter the labor force mostly through unemployment, while other nonparticipants enter the labor force mostly through employment.

Author: Federal Reserve Board
ISBN-10: 150322368X
ISBN-13: 9781503223684
Publisher: Createspace Independent Publishing Platform
Language: English
Published: 11/14/2014
Pages: 26
Format: Paperback
Weight: 0.19lbs
Size: 11.00h x 8.50w x 0.05d