Bittersweet Jobs Report: Wages Decline and Labor Force Participation Rate Falls to 37-Year Low
Today’s Labor Department unemployment report contains a fresh round of ominous news beyond the headline numbers.
Specifically, the labor participation rate fell to a new 37-year low, which is particularly negative news because women hadn’t yet fully entered the U.S. workforce during that previous 1970s low. Additionally, wages continued their decline:
Businesses had been creating jobs at a monthly pace of 224,000, though wage growth remained modest and the drop in the headline rate had come in large part due to a decline in the labor force participation rate. Indeed, the participation rate continued to plummet, falling to a fresh 37-year low of 62.7 percent. Job quality did not fare well either, with wages actually declining for the month by 5 cents an hour, pulling the annualized gain down to 1.7 percent.”
That annualized gain doesn’t substantively exceed inflation, and since the last recession ended almost six years ago in 2009, median U.S. income has actually declined. That is unprecedented for a supposed post-recession “recovery,” and Americans continue to simply drop out of the workforce. Something to keep prominently in mind when Barack Obama trumpets his supposed economic success.