Forget Lower Jobs Growth, the Number of People Who’ve Stopped Looking for Work is Much More Worrisome
The latest jobs report showed a lackluster gain in jobs in May that was worse than economists had predicted.
While the sudden slowdown in jobs growth after many months of strong numbers is worrying and signals a weakening economy, a more long-term concern is the persistently low labor force participation rate that has not recovered in the decade since the onset of the Great Recession.
I’ve been studying labor market issues for over much of my 30 year career as an economist. Let me explain why you should be paying more attention to the participation rate.