Recovery talk goes on and on. Assuming there is a genuine recovery as opposed to a financial recovery, where would one most likely find evidence?
I propose evidence should be apparent in those out of school, yet not retired. More specifically, we should see evidence in the age 25-54 demographic.
Let’s take a look.
Civilian Labor Force Participation Rate 1990-Present
The participation rate is the percentage of people who are either employed or actively seeking work.
Where is the recovery?
Some might accuse me of cherry picking a timeframe on the above chart. OK. Here is a longer-term chart.
Civilian Labor Force Participation Rate 1950-Present
Women entered the workforce en masse in the 1960s to 1990s. Leveling off is understandable, but why the decline?
Reader Tim Wallace dives in further, breaking out women vs. men.
25-54 Labor Force and Employment, Men and Women
The cheerleaders will tout the rise in employment. However, the rise in employment is from the depths of recession hell.
In percentage terms, the male participation rate for age group 25-54 is the lowest in history. The female participation rate for age group 25-54 is the lowest in 24 years.
Cyclical vs. Structural
Former Fed Chairman Ben Bernanke stated the unemployment problem is cyclical. I believe unemployment is a demographic-based structural issue.
If anyone has any credible evidence that shows the unemployment problem is cyclical in nature, not structural, please send it.
Mike “Mish” Shedlock