The unemployment rate’s accuracy as a job market measure has been diminished by a shrinking labor force. Partly, that shrinkage is caused by baby boomers retiring and young people going back to school. But a new analysis tunes out that statistical static. It looks at the change in employment among the prime-working-age population from the third quarter of 2007, just before the Great Recession, to the third quarter of 2014.
David Cooper of the Economic Policy Institute measured the change in employment among the prime-working-age population by state. The results show that the percentage of people ages 25 to 54 with a job has declined. And the slippage is uneven by state.
While the share of Americans 25-54 with a job has declined by 3.1 percentage points, some states are posting declines twice as large. North Carolina is 13th from the bottom with a decline of 4.1 percent.
The numbers show that despite an improving unemployment rate, many people who typically would be working are not. “You’re letting that economic potential sit idle,” said John Quinterno, principal at the Chapel Hill research firm South by North Strategies, which studies labor markets. “It calls attention to the fact that the economy is not producing enough opportunities for prime workers.”
What’s needed in North Carolina is less crowing about a “Carolina Comeback” based on the unemployment rate and more effort to get people fully employed.