There’s no doubt you’ve seen this chart before. It shows that the Labour Force Participation Rate is at its lowest level in decades.
Some people say that this chart represents throngs of workers who have “dropped out” of the workforce because jobs are hard to come by.
Others point to changing demographics and societal trends, including the graying of the population (older people are less likely to work) and the fact that young people are going to college more and more.
But neither of those trends is totally satisfactory, because the Labour Force Participation Rate is falling for prime-age workers who are neither retiring nor likely to be in college.
On this point, Bill McBride at Calculated Risk posts this chart of the Labour Force Participation Rate for prime-working aged men.
As you can see, the decline in the Labour Force Participation Rate in this demographic has been declining for about four decades. It’s really hard to look at this chart, and think that the recession changed the story much. Obviously, there are other big trends (cultural, technological perhaps?) that are behind the decline in this demographic. And any explanation that doesn’t account for the multi-decade trend falls flat.
McBride notes that he made the chart men-only for the sake of simplicity: The basic idea, presumably, is that for most of the above time period up until recently, the Labour Force Participation Rate among women rose significantly for well-known cultural reasons. By isolating men you see there’s some other longstanding force out there that’s reducing the number of men who are inclined to work.