I remember a professor saying this to class many years ago. It stuck with me.
Good
Hey, look! Since 2009, unemployment rates are going down. Wow, let's graph a regression line and marvel at that negative slope.
Un-good
But wait, over the same period of time, labor force participation has also been on the decline.
How do we help our students make sense of this?
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3 comments:
And what do baby boomers retiring have to do with the decrease in labor force participation? https://en.wikipedia.org/wiki/Demography_of_the_United_States#/media/File:USA_by_Sex_and_Age_2015-07-01.svg
The unemployment seems synchronized with the recessions, but the participation rate is not. I suspect that the participation rate bump is closely following the baby boomer careers and has little or nothing to do with the current state of the economy, but with broader social trends.
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