October 30, 2013
THE INCREDIBLE SHRINKING WORKFORCE: William Galston: Unless men re-enter the job market, prospects for vigorous growth in the labor force are dim.
Participation in the workforce is falling, the pace of job creation is anemic, and long-term unemployment remains stubbornly high. Many newly created jobs pay less than those that disappeared during the Great Recession, so real wages are stagnating, and median household income is no higher than it was a quarter of a century ago.
Our condition looks no better when we compare ourselves to other nations. As my Brookings Institution colleague Gary Burtless has observed, the United States was once viewed as the home of the “employment miracle.” As recently as 1989, it was a leader in labor-force participation and employment rates among the world’s most developed economies. That is no longer the case. . . .
What we do know is that the start of the third millennium marked the end of a long cycle in the U.S. employment market. In the early 1960s, labor-force participation among men ages 25 to 64 began a slow steady decline from 95% to about 84% today, a trend masked by the surge of women into the labor force. But women’s participation in the labor force peaked in 2000 and has since declined by two percentage points. Unless men re-enter the job market, prospects for the resumption of vigorous growth in the U.S. labor force are dim.
Some analytical modesty is in order. Men have been withdrawing from the workforce for five decades—in good times and bad, in tight and slack labor markets, in periods of Keynesian stimulus and green-eyeshade austerity. No one is sure why.
Well, some people have an idea.