WORKFORCE PARTICIPATION RATES (BY YEAR)

The decline in workforce participation uin the U.S,. is unique among develoed countries:*  Though Sweden went though a period of workforce participation in decline, in recent years it has begun to increase again.  But in spite of it all, Sweden has the highest workforce participation.   Spain that at one time had the lowest workforce participation went through a period of rapid increase, but the rate has flattened in recent years.  You can see in the figure, however, that the U.S. is unique among these countries in having a rapid decline in workforce participation since about 1998.

Among men age 25-54, the workforce participation rate started to decline as far back as the late 1970s, but the women's participation rate climbed until the late 1980s when it too started to decline.  Though the decline started before the Great Recession, it has picked up steam since.  No one seems to have any ideas as to why this is happening.  One might suppose, however, that the stagnation of workers salaries may be having an effect.  How are the dropouts making their way?  Perhaps there is a return to one worker families or people are working on the side (e.g working individually out of their homes), but no one knows.

 

 * http://blogs.wsj.com/economics/2015/06/26/the-u-s-stands-out-on-labor-force-participation-rates/