1.3 million Americans set to lose unemployment benefits Saturday

[DavenRoxy 1,073]

Sorry but that claim is actually false. There is a lower percentage of the civilian non-institutional population in the workforce but there are not fewer but actually more persons in the workforce today (155.3MM) than there were in Feb 2009 (154.2MM). There are also more persons employed today (144.4MM) than there were in Feb 2009 (141.7MM). It's easy to see that the number of employed persons has grown faster (+2.7MM) than the number of persons in the workforce (+1.1MM). Hence the decline in the unemployment rate between then (8.1%) and now (7%).

I apologize in advance for having injected facts into the discussion.

Again, statistics tell the story the author wishes to tell. And as such, can be misleading enough so as to be useless or worse. You say HIS table is wrong, but put full faith in yours. And I bet if I tried, I could find a third source that paints a different picture.

[Mr. Big Dog 10,747]

And yet, when you factor in the 3+% fall in the workforce...

...you still have more persons in the workforce now than you did when this administration took over. Slice it any way you want, the statement that there are fewer persons in the workforce now than there were then is false. It's not that hard to see, really.

And it's not a 3+% fall in the workforce but a 0.7% increase as I have pointed out (up 1.1MM from 154.2MM). Now, the labor force participation rate is lower now than it was then. It went down 2.6 percentage points from 65.6% to 63% to be precise. That is what happens when the share of 55 - 65 year olds in the larbor force (a slice of the labor force with a lower labor force participation rate than those in the 30 - 55 age bracket) continues to rise as the baby boomers near and reach retirement age. Add to that more kids that spend more time in college because the labor market demands it and you have a pretty good explanation as to why the labor force participation rate is going down. The tough job market that the Great Recession brought along certainly didn;t help either but that's only part of the equation. The labor force participation rate will continue on this downward trajectory that it has been on since the beginning of this century for some time to come.

[Mr. Big Dog 10,747]

Again, statistics tell the story the author wishes to tell. And as such, can be misleading enough so as to be useless or worse. You say HIS table is wrong, but put full faith in yours. And I bet if I tried, I could find a third source that paints a different picture.

His table? He didn't present a table. He presented a statement that was false. Not much to argue about on that point.

[Pooky 3,784]

...you still have more persons in the workforce now than you did when this administration took over. Slice it any way you want, the statement that there are fewer persons in the workforce now than there were then is false. It's not that hard to see, really.

Agreed, but your statistics omits any mention that the pool of possible labor has increased by more than the increase in employment. As a percentage of the overall, the workforce has declined.

And it's not a 3+% fall in the workforce but a 0.7% increase as I have pointed out (up 1.1MM from 154.2MM). Now, the labor force participation rate is lower now than it was then. It went down 2.6 percentage points from 65.6% to 63% to be precise. That is what happens when the share of 55 - 65 year olds in the larbor force (a slice of the labor force with a lower labor force participation rate than those in the 30 - 55 age bracket) continues to rise as the baby boomers near and reach retirement age. Add to that more kids that spend more time in college because the labor market demands it and you have a pretty good explanation as to why the labor force participation rate is going down. The tough job market that the Great Recession brought along certainly didn;t help either but that's only part of the equation. The labor force participation rate will continue on this downward trajectory that it has been on since the beginning of this century for some time to come.

Five years is way too short of a timescale to push the retiree ratio up by 3%, no matter how much you want it to explain the difference away. Those that have abandoned hope of finding work, are working purely on the side, or just don't appear in the figures at all will also figure into the numbers. Given the economic situation since It fell apart at the end of BushBaby's second term, they are more likely to make up the majority of the shortfall than the aging baby boomers.

[I AM NOT THAT GUY 5,715]

Given the economic situation since It fell apart at the end of BushBaby's second term, they are more likely to make up the majority of the shortfall than the aging baby boomers.

One of the legacies of the Clinton Administration, as B.D.'s graph shows indirectly, is the large number of folks deciding to work for themselves, rather than take one or two of the extra "jobs" the Clinton administration "created". As the tech bubble collapsed, the trend toward entrepreneurship actually accelerated under the encouragement of the Bush Administration, despite a failing real estate market, until first the spike in fuel prices, and then the collapse of the mortgage market in Bush's waning years. Under Obama, many of those folks were forced to close their businesses, and even the crappy Clinton era jobs went poof as well.

[Mr. Big Dog 10,747]

Agreed, but your statistics omits any mention that the pool of possible labor has increased by more than the increase in employment. As a percentage of the overall, the workforce has declined.

It omits that because that wasn't the issue I was addressing. I addressed only the point that the workforce has more rather than fewer persons as was falsely claimed.

[I AM NOT THAT GUY 5,715]

It omits that because that wasn't the issue I was addressing. I addressed only the point that the workforce has more rather than fewer persons as was falsely claimed.

[Mr. Big Dog 10,747]

Five years is way too short of a timescale to push the retiree ratio up by 3%, no matter how much you want it to explain the difference away.

Really? Let's have a look, shall we?

Between 2002 and 2012 as part of the civil non-institutional population, 16-24 year olds have held steady at 16%. The 25-54 bracket has decreased from 56% to 51% of the population and the 55 and older crowd has increased its share from 28% to 33%. That shift between the latter two is precisely what explains the majority of the decreased labor force participation rate. How do we know that?

Well, let's look at the labor force participation rates of these brackets and see what the impact of the aforementioned shift would be. The labor force participation rate of the 55+ crowd has actually increased from 34.5% in 2002 to 40.5% in 2012. That's a steep climb. But not steep enough enough to offset the overall lower participation rate of that bracket as that bracket makes up a larger part of the labor force. Even after that steep climb, the labor force participation rate of that group is still not even half of that of the 25-54 bracket. While not significant for the purposes of this demonstration, I'll mention for the sake of completeness that the 16 - 24 group has seen the labor force participation rate decline from 63.3% to 54.9% over that decade. Which makes sense seeing that more kids spend time in college to get ready for a career. The 25 - 54 age bracket had a decline in the labor force participation from 83.3% to 81.4%.

Now, to test my theory, that the shift in demographics is mostly responsible for the labor force participation rate decline we should apply the 2012 labor force participation rates to a demographic resembling that of 2002 - one where 16% of the population is in the 16-24 bracket, 56% in the 25-54 bracket and the remaining 28% in the 55 and older bracket as was the case in 2002. Applying that 2002 demographic to the actual 2012 labor force participation rates for the respective age groups would tell us what the overall labor force participation would be if the demographic composition hadn't changed.

Doing this, we come up with the following:

Of the 243.3MM total 2012 civil non-institutional population, 39.5MM fall into the 16-24 group, 136.4MM are in the 25-54 group and 67.4MM are 55 and older. Applying the 2012 labor force participation rates, we have 39.5MM * 0.549 = 21.7MM; 136.4MM * 0.814 = 111MM and 67.4MM * 0.405 = 27.3MM. That comes to a total labor force of 160MM.

160MM out of 243.3MM comes to a labor force participation rate of 65.8%.

So, all else being equal but without the demographic changes that took place over the last decade, the labor force participation rate would be less than a percentage point lower now than it was a decade ago. Which is precisely what I said.

Now what?

Edited December 29, 2013 by Mr. Big Dog

[Mr. Big Dog 10,747]

You made a mistake. It's really not a big deal. You can just accept it and move on.

[Pooky 3,784]

Now what?

So let me get this straight. To prove a demographic shift between 2009 and 2013, you choose data from a start point of 2002, both different to and well outside the timeframe in question, and base your validation on that information being comparable. I guess logic really isn't your strong suit.

You don't have any actual comparison data for the period in question, 2009 - 2013, do you? If you did, you would have posted it already.

[Mr. Big Dog 10,747]

So let me get this straight. To prove a demographic shift between 2009 and 2013, you choose data from a start point of 2002, both different to and well outside the timeframe in question, and base your validation on that information being comparable. I guess logic really isn't your strong suit.

You don't have any actual comparison data for the period in question, 2009 - 2013, do you? If you did, you would have posted it already.

I've never made any specific claim for the 2009-2013 time span. I have said that the changing demographics have a major influence on the labor force participation rate, that the decline in the labor force participation rate is a trend that started in the early 2000's and that it will continue for some years to come. Specifically I stated:

The labor force participation rate will continue on this downward trajectory that it has been on since the beginning of this century for some time to come.

That is a fact and I demonstrated that with the available data. I know that you'd like to shift the goal post but it won't work because you are asking me to defend claims I haven't made. When you take a look at the available data, you find that the labor force participation rate would have declined less than 1% over the last decade had the demographics remained stable. What you are effectively postulating is that the labor force participation rate has declined much more due to demographics over the first half of that decade than the second half - that would have to be true to leave more of the decline to other factors in the latter part of that decade. How do you back that postulate up?

Edited December 31, 2013 by Mr. Big Dog

[Pooky 3,784]

Sorry but that claim is actually false. There is a lower percentage of the civilian non-institutional population in the workforce but there are not fewer but actually more persons in the workforce today (155.3MM) than there were in Feb 2009 (154.2MM). There are also more persons employed today (144.4MM) than there were in Feb 2009 (141.7MM). It's easy to see that the number of employed persons has grown faster (+2.7MM) than the number of persons in the workforce (+1.1MM). Hence the decline in the unemployment rate between then (8.1%) and now (7%).

And yet, when you factor in the 3+% fall in the workforce, nowhere near all of which can be explained away by aging out of the workforce, you see why the bare numerical statistics are treated with such disdain.

Where has that 3% gone? As a part of a 66% participation rate in 2009. This would amount to about a 4.5% adder to the unemployment rate that has simply gone missing in the last 5 years.

And it's not a 3+% fall in the workforce but a 0.7% increase as I have pointed out (up 1.1MM from 154.2MM). Now, the labor force participation rate is lower now than it was then. It went down 2.6 percentage points from 65.6% to 63% to be precise. That is what happens when the share of 55 - 65 year olds in the larbor force (a slice of the labor force with a lower labor force participation rate than those in the 30 - 55 age bracket) continues to rise as the baby boomers near and reach retirement age.

Five years is way too short of a timescale to push the retiree ratio up by 3%, no matter how much you want it to explain the difference away. Those that have abandoned hope of finding work, are working purely on the side, or just don't appear in the figures at all will also figure into the numbers. Given the economic situation since It fell apart at the end of BushBaby's second term, they are more likely to make up the majority of the shortfall than the aging baby boomers.

Really? Let's have a look, shall we?

Between 2002 and 2012 ...

So let me get this straight. To prove a demographic shift between 2009 and 2013, you choose data from a start point of 2002, both different to and well outside the timeframe in question, and base your validation on that information being comparable. I guess logic really isn't your strong suit.

You don't have any actual comparison data for the period in question, 2009 - 2013, do you? If you did, you would have posted it already.

I've never made any specific claim for the 2009-2013 time span.

Funny you should say that, but you were arguing that very time period up until the point you couldn't back it up. It seems that when you could find no "facts" to sustain your argument, you tried to change the dynamic of the discussion. Pity that. I used to think better of you.

[Mr. Big Dog 10,747]

Funny you should say that, but you were arguing that very time period up until the point you couldn't back it up. It seems that when you could find no "facts" to sustain your argument, you tried to change the dynamic of the discussion. Pity that. I used to think better of you.

Good Lord, spare me that line of argument which really isn't an argument to begin with. What we have here is not my running out of facts. Rather, it appears painfully obvious that you really don't understand simple math. When the population shifts to become heavier on the end with the lowest labor force participation rate and lighter in the crowd that boasts the higher rates, then the overall labor force participation rate will go down. This trend will actually accelerate over time because the 55+ crowd has a higher labor force participation rate than the 65+ crowd. So as we move the baby boomers into and through retirement (they are currently 49-67 years old), the weight will shift into the higher age brackets over time and the overall labor force participation will be reduced further as a result.

So let's take the narrower 2009 - 2012 figures (that's the closest year span for which I found data) and you will find the exact same trend in that span as you would over the decade. If you take away the demographic changes that occurred over just these 3 years 2009 to 2012, you would be looking at a 2012 labor force participation rate of 65.6% (i/o 63.6%) - that's some 2% above what it actually was leaving only a percentage point to other factors. Different time frame, same result. It's how long term trends manifest themselves.

The 16-24 age bracket was fairly stable over that period making up 15.9% of the population, the 25-54 bracket made up 53.3% in 2009 and fell to 51.1% in 2012 while the 55 and older crowd gained from 30.8% to 33%. Labor force participation rates for these brackets were 56.9/54.9 (16-24), 82.6/81.4 (25-54) and 40/40.5 (55+). Total civilian non-institutionalized population went from 235.8MM to 243.3MM over that period. That's the data, do the math. Bottom line, demographic changes account for the majority in the labor force participation rate decline. Period.

You were saying that "Five years is way too short of a timescale to push the retiree ratio up by 3%, no matter how much you want it to explain the difference away.". Well, just three out of those 5 years explain most of the decline away solely on the demographic changes. You were wrong.