Workers Really Are Dropping Out of the Job Market

A new poll of unemployed
Americans finds that almost half of them have given up looking for
a job. That casts a depressing light on the debate over why the
labor force participation rate has rolled downhill in recent years.
Folks saying the economy isn’t as sucky as it looks claim that
demographic changes—especially an aging population—drive the
plunge. Others say the job market is sluggish at best and that
people are just giving up. The poll lends support for that
depressing second bunch—and maybe for the idea that some job
seekers need a nudge.

The April poll of 1,500 unemployed, conducted by Harris Poll on
behalf of Express Employment Professionals, finds some
not-so-encouraging results:

• 47 percent agree with the statement, “I’ve completely given up
  on looking for a job.” (7 percent said they “agree completely,” 7
  percent “agree a lot,” 15 percent “agree somewhat,” and 18 percent
  “agree a little.”)

• 46 percent report not having gone on any job interviews in the
  prior month. Among those unemployed for more than two years, 71
  percent report not having gone on any interviews in the prior
  month.

• 23 percent say their last interview was in 2012 or before.

• 60 percent say looking for work has been harder than expected.
  10 percent say it’s been easier than expected.

In recent years, the Labor Force
Participation Rate nosedived from above 66 percent of the
potential workforce to below 63 percent, which is the lowest level
since 1978. This has engendered much rending of garments and
gnashing of teeth—and the public debate mentioned above about
“why.”

An
aging work force gets some of the “credit” for the drop.
Americans age and retire and there are relatively fewer young
workers to take their place. A
report from the Philadelphia Federal Reserve Bank, published
earlier this year, attributed about two-thirds of the decline since
2000 to a combination of retirement and disability, with a surge in
retiring Baby Boomers over the past couple of years. (Disturbingly,
“the number of disabled persons has been steadily rising.”)

But the report found that discouraged workers, with a big
increase in that category during the recession, explained 30
percent of declining labor force participation. In addition,
“nonparticipation due to schooling has been steadily increasing,”
which could well reflect another form of dropping out, as potential
workers continue along or return to the education track after
taking a look at the job market.

The poll does raise some concerns over whether all turned-off
job seekers are willing to go the extra mile to find a paying gig.
Forty-four percent are not willing to change towns in search of
work, and 60 percent won’t cross a state line.

That might have something to do with the 72 percent who call
unemployment compensation a “cushion” and the 48 percent who say
they “haven’t had to look for work as hard” because of it.

Or maybe they just think things are lousy all over.