In the debate about whether the headline unemployment rate tells the whole story about the labor market, here’s another data point indicating there’s more than meets the eye. From the Washington Post:
The proportion of Americans in their prime working years who have jobs is smaller than it has been at any time in the 23 years before the recession, according to federal statistics, reflecting the profound and lasting effects that the downturn has had on the nation’s economic prospects.
By this measure, the jobs situation has improved little in recent years. The percentage of workers between the ages of 25 and 54 who have jobs now stands at 75.7 percent, just a percentage point over what it was at the downturn’s worst, according to federal statistics.
Before the recession the proportion hovered at 80 percent.
The story explains once more why the headline unemployment rate, which has held steady or fallen for 11 straight months, doesn’t paint the whole picture. Short answer: It’s about the continued problem of people giving up searching for work and taking themselves, statistically speaking, out of the work force — leading the unemployment rate to fall at a faster pace than job creation is rising.
But even this stat for 25- to 54-year-olds doesn’t tell the whole story. Further down in the article, we read:
The falloff has been sharpest for men, for whom the proportion had been on a slow decline before the recession. The percentage of prime-age men who are working is smaller now than it has been in any time before the recession, going all the way back to 1948, according to federal statistics. The proportion of prime-age women is at a low not seen since 1988.
That’s right: The proportion of prime-age men with a job is the smallest in at least 64 years. I say “at least” because 1948 is as far back as federal labor statistics go.
In the immediate future, this reality means the job market will have a larger impact on President Obama’s re-election chances than the steadily declining unemployment rate would suggest. Until participation in the labor force readjusts to historically normal levels, the unemployment rate doesn’t tell us as much as it once did. So the usual measures of how an incumbent does when the jobless rate is above or below X percent won’t do prognosticators as much good.
More broadly, however, this speaks to the issues Charles Murray highlights in his recent book, “Coming Apart.” Murray documents the dramatic divergence in employment between what he calls “the new upper class” and “the new lower class” — and argues that government programs that foster a culture of dependence and lack of personal responsibility have enabled this joblessness among men who otherwise ought to be working.
That broader context of the competing political ideologies in our country makes it all the more worthwhile for these depressing employment trends to be at the center of this year’s presidential campaign.
– By Kyle Wingfield