The Feds reported that the unemployment rate dropped to 7.3% … despite tepid job growth – fewer jobs added than expected, and those that were added were in retail & hospitality.
Most analysts quickly pointed out that the unemployment rate dropped because the number of people dropping out of the labor force was about twice the number of jobs added.
In technical jargon, the labor force participation rate dropped to a 35 year low.
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A complementary metric that combines the effect of the Unemployment Rate and the Labor Force Participation Rate is the Civilian Employment to Population Ratio – the percentage of the working age population that has a job.
That rate dropped about 4 percentage points during the recession … then has flatlined during the “recovery”.
That is, job growth has barely kept up with population growth.
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What about my favorite? The downmixing to more part time positions?
