New normal: More able-bodied men sitting on their duffs …

Forget ‘Labor Force Participation Rate’ …  here’s the indicator to watch


It’s no secret that the Labor Force Participation — the % of able bodied adults who are employed or looking for work —  has dropped about 4-1/2 percentage points .



The economy-is-doing-just-fine crowd chalks the declining rate to demographics – old-timers retiring.

In prior posts I’ve attributed about 1/3 to retirees … the rest to slackers.

To that point, let’s cut the data a different way …


I stumbled on another Fed data series – the Inactivity Rate.

The inactivity rate is the percentage of able bodied adults who are neither employed nor looking for work

The number-crunchers even report the activity rate by sex and age category.

Below is the Inactivity Rate for men between 25 and 54.

That takes out teens and retirees.



Note that during the Bill Clinton years the inactivity rate among 25 to 54 year old men held relatively constant at about 8.5% .

The rate jumped a point during the Bush years to 9.5%.

During these recent all-is-well days, the rate hopped a northeast trajectory to its current rate – just under 12%.

That’s almost 12% of our 25 to 54 year old able-bodied men kicking back without a job.

They are either unemployed … or out of the labor force (i.e. not even looking).

Smoking economy, right?



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