The Problem of US Labor Force Participation

Abstract

Despite more robust growth than many advanced economies in Europe and Asia, labor force participation in the United States between 1995 and 2017 was weak. In other countries, job loss has manifested itself as increased unemployment as opposed to labor force exit. For men, the decline in labor force participation appears to be partly structural, as it is common across countries, and partly related to disability. For women, disability was an even more important contributor to the decline in their labor force participation, explaining nearly two-thirds of the decline in labor force participation of prime-aged workers.