Are demographics really to blame for the struggling economy?
posted at 6:31 pm on April 7, 2013 by Erika Johnsen
The March jobs report saw the civilian labor force shrink by another 496,000, bringing the participation rate down to 63.3 percent — America’s lowest rate since the era of Jimmy Carter. Ouch.
Almost immediately after the awful news, the White House trotted out their chief economist Alan Krueger, who tried to defend and explain away the terrible report with several lines of reasoning, including that some of the workforce shrinkage is due to the demographic shifts of an aging population: “The labor force participation rate peaked in 2000 because of demographics. We are getting older as a nation. Its an issue we face.”
Nice attempt at sugarcoating there, but not really.
The financial crisis and subsequent Slowest Recovery Evah has older workers holding off on retirement in droves, and of the job creation that the economy is seeing, a lot of it is concentrated in the older age brackets. Using information from the BLS, ZeroHedge put together this handy little chart illustrating that, in the past few years, the most robust job creation has been for the 55+ age group, with the lower brackets seeing a lot of losses:
The problem isn’t so much an aging workforce as it is simply a terrible economy that can’t generate jobs for people in their key work years, while younger workers’ option are increasingly limited to part-time work and veteran workers delay retirement. Bad times all around.