Forever young

6 March 2012 By Daniel Indiviglio

Some 4 mln people under 55 may soon seek employment, a Breakingviews analysis of labor participation rates shows. Yet the share of older folks working has grown – and they might not retire so fast. As the economy improves, the two trends could wreak havoc on the jobless rate.

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The U.S. labor participation rate in January dropped to 63.7 percent, the lowest since 1983, according to the latest figures released by the U.S. Bureau of Labor Statistics, on Feb. 3. The country’s unemployment rate stands at 8.3 percent, down from a peak of 10 percent in October 2009.
A March 1 report by Barclays Economics Research argues that retirement among baby boomers has played a larger role in pushing down the rate of labor force participation than has discouraged workers’ leaving the job market. The analysts also say they believe the shift will continue in the coming years and help open up more jobs for the unemployed.

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