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U.S. labor force is growing at a slower pace

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The U.S. labor force is growing at about half the rate it was 20 years ago and is expected to expand at a slightly lower pace through 2020, according to The Washington Post.

Slower growth in the labor force can impede gross domestic product and employment, making it less likely that the economy will recover at the rate it has during previous recessions. Research shows that as much as half of the current recovery's slowness may be attributed to the U.S. labor force's declining growth.

During the mid-1980s, the labor force was growing at about 1.7 percent per year. Growth fell to about 0.9 percent by the mid-2000s and is expected to shrink to about 0.6 percent by the end of the decade.

The Bureau of Labor Statistics reports the slower growth stems from two factors: The U.S. population is growing more slowly, and the percentage of Americans working or seeking work will continue to decline as the population ages.

One of the primary causes for slower labor force growth is the retiring baby-boom generation. Another is that a rapid rise in working women during the 1990s led to a surge in the labor force's size; however, the percentage of women in the labor force reached 60 percent and stopped climbing. Still, it is possible it hasn't reached its peak; high numbers of women are attaining bachelor's degrees and could enter the work force.

Labor force participation among men 25 and older has been declining, standing at 73 percent.


4/18/2012

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