Unlike the unemployment rate, which fluctuates depending on economic conditions, the labor force dropout rate has marched quietly upward, affected only marginally by the state of the economy at any given time. The rise has been so gradual that it rarely generates any news stories or alarmed speeches from politicians. Nevertheless, the problem has begun to attract attention in public policy circles, with major reports published by the Obama White House, the Brookings Institution, and the American Enterprise Institute.
A common finding in those reports is that, although prime-age men across the socioeconomic spectrum have been dropping out of the workforce, the problem is most acute among the less-skilled native born. A relatively low 6 percent of native-born college graduate men are out of the labor force, but 17 percent of native men with only a high school diploma are not looking for work, as are 36 percent of high school dropouts. Black Americans have a labor-force dropout rate of 22 percent.
Differences across skill groups are evident not just in labor-force participation but in detailed time-diaries indicating how much people work.3 Pooling American Time Use Survey (ATUS) data from 2003 to 2015 shows that native-born prime-age men who are college graduates worked an average of 2,039 hours per year, or the equivalent of 51 full-time weeks. By contrast, native-born prime-age men with only a high school diploma worked the equivalent of 45 weeks, and those without a diploma worked just 35. Black men worked an average of 39 weeks, with considerable variation across education levels.