The above table comes from Bill McBride at Calculated risk, and it shows the changes to the populations of various age groups over the last six years.
There’s been a lot of talk about the declining Labour Force Participation Rate, and how much has to do with the weak economy and how much has to do with demographics. But you just can’t ignore the chart above, which shows there’s been a massive surge in the 55+ cohort, and a DECLINE in the prime working age cohort.
The key thing, as Bill notes, is that while it’s true that the Labour Force Participation Rate for the 55+ cohort has gone up in recent years, overall it’s relatively low, so the shift in people from prime to 55+ represents a drag on total workforce participation.
This isn’t the end of the story, by any means. But these are the basics: There’s been a big change in US demographics in just the last few years, and you can’t begin to talk about the job market or anything else without seeing the above numbers.