Thursday, January 9, 2014

Labor Force Participation by Education

Here's an interesting graph from the Cleveland Fed:

I know I'm kind of beating a dead horse here, but each new chart I see of LFP seems to show the same pattern.  Everyone talks as if cyclical factors are the overwhelming issue in LFP, yet again and again, when we slice up the labor force, we find that other factors are so much more important that it's hard to even see the cyclical effects.

There is some cyclical effect, and it can be visually magnified by showing aggregate LFP over a short time frame with a very tight scale on the y-axis.

But, whether we categorize workers by age or education level, these factors are many times more significant than cyclical effects.

And, here again with education levels, as with age groups, we find this long term, very linear down trend across almost all categories of a little more than 1% per decade.  The decline is slightly steeper here compared to the age group trends, and it is accelerating downward, because the aging issue is pulling the levels of all of the education categories down.

The most interesting item here is that the one category of worker where LFP has been rising over the long term is the "Less than High School" category.

Once again, this just doesn't look to me like a LFP trend that is falling because workers at the lower tiers of the labor force are quitting out of desperation.  There are deeper issues working here - either some labor market disruptions such as rising health care costs, or simply the choices of a wealthier society - which may not have or need an obvious solution.


  1. Technology killing jobs faster than they can be replaced

  2. The report examines the relationship between education levels and workforce engagement, highlighting the significant role of education in shaping employment trends. It provides valuable insights for policymakers and educators, enhancing our understanding of evolving job market dynamics. The comprehensive nature of the study contributes to the discourse on education's role in shaping labor force participation.
    New Jersey Domestic Violence Lawyer