Our Aging Workforce is over participating

Tale of Two Data Sets - Part Five

The February jobs report was misreported in the mainstream media. The headline was that there were only 20,000 non-farm payroll "jobs" creates during February. The problem is that this is not true. The Current Employment Statistics (CES) data used for the headline value measures workers. The Current Population Survey (CPS) data measures jobs and unemployed workers. The CPS data  recorded over 1.2 million non-seasonally adjusted (NSA) combined full-time and part-time jobs added to the economy during February. This is how the worker data came in weak and the participation and unemployment data came in strong.

This column has already published a number of articles regarding the February Jobs Report:

• "February Jobs Report: 1.2 Million Jobs or 25,000 Workers Added" compared the NSA CPS data (1.2 million jobs) and the SA CES  (25,000 Private Sector Workers. It was a fabulous, remarkable, jobs report.
  
• "February Wages and Workers: Wow" examined the sector by sector growth in workers and wages compared to February 2018.  The average weekly wage, NSA, was up 3.44% while the workforce population grew by 1.93%, NSA, from February 2018. This means the total earning power rose by 5.11% during the time from February 2018 to February 2019.
  
• "Five Presidents at 25 Months" compared President Trump's accomplishments with those of former Presidents Reagan, Clinton, George W Bush, and Obama after their first 25 months in office." Only former President Clinton and President Trump managed to cut unemployment and add full-time jobs simultaneously.  President Trump has added more full-time jobs than his predecessors, combined.
  
• "February Men, Women, Multiple Job Worker Data:Strong" examined the CPS data and found that we had a February record level of Men working and a February record number of women working, and we did not have a record level of multiple job workers this February.
  

The question is is everyone, of every age group, benefiting from the recovery and expansion?

"All recessions are jobs recessions." This column has written a number of articles regarding the prior recession. The "Great Recession" was three recessions rolled into one: A Housing Recession, a Jobs Recession, and a Retail Recession wrapped into a GDP  (Gross Domestic Product) Recession. "When did the Great Recession Really Begin"goes into detail.  The "Five Presidents"  article examined the CPS data and found that we had the best February ever for end of the month CPS jobs data. If we see declines in same month data then we may be entering a recession - if it happens for more than one or two months.

We have 11.7 million more CPS Jobs now than we had during  February 2007.  We lost 7.276 million CPS jobs, full-time and part-time combined, between February 2007 and February 2010. There was a slight uptick between February 2007 and 2008 of 72,000 jobs. Total jobs have increased 1.7 million jobs between last February and this February.  This is the difference between the CPS data that is used to calculate the participation and unemployment rates and the CES worker data used to promote the "jobs" number.

Full employment without full participation. You cannot compare the current unemployment rate  The "Five Presidents" article compared the third February unemployment rates of former Presidents Reagan and Clinton with current President Trump. Would you rather have 63.20% participation and 11.29% unemployment, February 1983, or 63.00% participation and 4.07% unemployment? That is easy. Would you rather have 63.00% participation and 4.07% unemployment or 66.81% participation and 4.75% unemployment, as we had during February 1999? There are comparisons being made regarding unemployment levels or unemployment rates from today with the unemployment data from the past 50 years. You have to factor in the participation rate realizing that unemployed workers are participants. We are missing millions of participants.

Record Teen unemployment urban legend. The teen unemployment levels are at record lows. The problem is that teen participation is near record lows. This was under participation was highlighted this past Summer in the article "July Teen Participation Shockingly Low."

Not All Age Groups have seen an increase in jobs.  Teen workers and those 45-49 years of age and 50-54 years of age saw the number of jobs fall February to February. It is important to note that we set  February record level of jobs for those 55-59, 60-64, 65-69, 70-74, and 75 years and older.

The workforce population for those 16-24 years of age fell from last February. The same thing is true regarding those 45-49 and 55-59 years of age. If you examine the jobs data you will find that we have 300,000 more workers in the workforce population for 65-69 years olds compared to 16-19 year olds. There are also 1.002 million more workers who are 65-69 years of age who have jobs compared to those 16-19 years of age.

Do we really have a negative unemployment rate for those over the age of 60? If we do not have full employment without full participation, and if we use the same technique to calculate the effective unemployment rate by age group as was used to calculate the overall U-7 unemployment rate then we find that the effective unemployment rate for teens is 28.99% compared to the -28.02% (negative) unemployment rate for those over the age of 75 years old.

Big Difference between 10,000 people turning 65 every day and 10,000 people retiring every day. Contrary to what you are hearing elsewhere,  we are not seeing thousands of Baby Boomers retiring every day, we have thousand of Baby Boomers who are eligible for Social security who are choosing work over retirement every day. one news source ran the headline "10,000 Boomers turn 65 Every Day" while another ran the headline "Health-care dilemma: 10,000 boomers retiring each day." Same number, different implications.

Contrary to what you hear elsewhere, we are not at full employment. We have millions of missing workers. Contrary to what you hear earlier this month, the number of jobs surged during February. It was "A Tale of Two Data Sets."  One of the reasons that participation is improving is that we have more older workers working longer into their retirement years. We do not have record low teen unemployment because we have record levels of teen workers. We have low teen unemployment because we have low teen participation. 

It's the economy