Taps Coogan – October 8th, 2023

America has lots of problems but labor participation isn’t one of them. The prime age (25-54 years old) labor participation rate has hit 83.5% in September, tying this June for the highest level since May of 2002 and barely 1% below the all-time high of 84.6% in January 1999.

This comes despite the average age of people within the 25-54 cohort skewing ever closer to 54 due to the aging of the US population.

With labor participation among those over 54 also above the historical average despite more and more of that cohort being well over the retirement age, the only place left to tap for labor is the youth, where participation has long been low and falling due to college enrollment, under the table work, and cultural trends.

The good news is that America is, by and large, at work. The bad news is that Uncle Sam is still running near record deficits at a time when it should be easier to balance the books.