by Ryan Streeter on March 26, 2014. Follow Ryan on Twitter.
There’s no real consensus on why our labor force participation rates are dropping like they are. Brennan sums it up this way:
With American labor-force-participation level dropping so dramatically, a lot of economists have been asking and debating how much of it can be attributed to demographics and how much to economic weakness: America is getting older, and the rate at which women work isn’t skyrocketing anymore. But prime-age labor-force participation removes the former of those concerns, and we’re still seeing a noticeable drop. The consensus estimates are that something like one-half to two-thirds of the labor-force drop are due to demographics (which still, of course, presents an economic and fiscal problem, even if it it’s inevitable).
Another, more depressing conclusion: The drop in labor-force-participation among prime-age men isn’t so much about continued economic weakness as it is about permanent shifts that have depressed wages (making work less appealing than non-work) and suppressed jobs growth.