Labor Force Participation Rate In The United States
Over the years, the Labor Force Participation Rate has become an overlooked statistic that many Americans do not seem too worried about. The average person considers the quarterly report done by the Bureau of Economic Statistics calculating the GDP and the unemployment rate to be sufficient enough to understand how and why the economy is forming the way it is. By now, many Americans have realized that our economic growth has declined, and the Bureau of Economic Statistics reported that, “GDP came in at 1.5 percent increase, a sharp decline from 3.9 percent in Q2”, and this is due to having the lowest Labor Force Participation Rate in 38 years (62.6%). The reason why the LFPR is at one of the lowest ever recorded in American history, is because
…show more content…
There has been an influx of students majoring in humanities and education, such as psychology and teaching, which has led to structural unemployment once the students enter the workforce. Structural unemployment is defined by Investopedia as, “a mismatch between what companies need and what workers can offer skill wise,” meaning that too many people are offering the same skills to companies, and no applicants are standing out with what they can do. Economists such as Mark Weinstock believe that structural unemployment has led to, “A decline in the LFPR, because no company wants to hire all the workers who have the same skills from the same field that they acquired during college.” Many college students now are going into “easier” majors with higher grade inflation, such as psychology, because they believe that having a high GPA will correlate with their starting salary. Jane S. Halonen, Ph.D. the Dean of the College of Arts & Sciences at the University of West Florida did a report on psychology majors, and found that, “there is a grade inflation, which may have lead to the popularity increasing in the major.” Here, students are picking a major that has a low demand for work, but a high supply for entry-level position. This means that a majority of people entering the workforce after college are unable to secure a position, which leads to them being a portion of the Labor Force Participation Rate that is actively searching for a job. The goal for those entering the Civilian Labor Force is to find a major that has high demand for work once they graduate, and a small increase in growth over time. That way, the skills they acquired in college are more desirable by companies looking to hire employees, which could lead to a potentially larger salary than expected. In due time, the
There has been an influx of students majoring in humanities and education, such as psychology and teaching, which has led to structural unemployment once the students enter the workforce. Structural unemployment is defined by Investopedia as, “a mismatch between what companies need and what workers can offer skill wise,” meaning that too many people are offering the same skills to companies, and no applicants are standing out with what they can do. Economists such as Mark Weinstock believe that structural unemployment has led to, “A decline in the LFPR, because no company wants to hire all the workers who have the same skills from the same field that they acquired during college.” Many college students now are going into “easier” majors with higher grade inflation, such as psychology, because they believe that having a high GPA will correlate with their starting salary. Jane S. Halonen, Ph.D. the Dean of the College of Arts & Sciences at the University of West Florida did a report on psychology majors, and found that, “there is a grade inflation, which may have lead to the popularity increasing in the major.” Here, students are picking a major that has a low demand for work, but a high supply for entry-level position. This means that a majority of people entering the workforce after college are unable to secure a position, which leads to them being a portion of the Labor Force Participation Rate that is actively searching for a job. The goal for those entering the Civilian Labor Force is to find a major that has high demand for work once they graduate, and a small increase in growth over time. That way, the skills they acquired in college are more desirable by companies looking to hire employees, which could lead to a potentially larger salary than expected. In due time, the