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Economic SYNOPSES short essays and reports on the economic issues of the day 2006 ■ Number 9 Look Who’s Working Now Kristie M. Engemann and Michael T. Owyang he landscape for the American worker has changed What might explain these trends? As mentioned above, dramatically since the early 1950s. Immigration and the rise in the overall LFPR has been driven primarily by social change have greatly altered the composition of increased labor force participation of married women. the labor force. For instance, women accounted for 31.6 perEngemann and Owyang discuss a few of the existing economic cent of the labor force in 1955, whereas they accounted for theories that explain this trend.2 Among those are the delay 46.4 percent in 2005. of fertility, spurred by the birth control pill, and widespread The overall labor force participation rate (LFPR) for those adoption of time-saving household technology, both of which at least 16 years old has risen from 59.2 percent in 1955 to have allowed women to enter the labor force to a greater extent. 66.0 percent in 2005; so, a higher percentage of eligible workTo explain higher variability among minorities, Wall points out ers are now in the labor force. This rise in LFPR, however, has that black employment is hit harder during recessions than been driven significantly by the steep rise in labor force particiwhite employment and that the former rises more quickly than pation by women. Furthermore, virtually all of this increase is the latter during expansions.3 Similar patterns may come into attributable to married women, whose LFPR rose from 28.5 play for Hispanic and overall LFPRs. ■ 1 percent to 60.7 percent. Conversely, the change in unmarried 1 The rise in married women’s LFPR occurred predominantly between 1955 and women’s LFPR was a mere 4.9 percentage points, from 61.1 to 1995; since 1995, it has been relatively stable. 66.0 percent. Over the same period, men’s overall LFPR actu2 Engemann, Kristie M. and Owyang, Michael T. “Social Changes Lead Married ally fell 12.0 percentage points (from 85.3 to 73.3 percent), in Women into Labor Force.” Federal Reserve Bank of St. Louis The Regional large part because of the decline in married men’s LFPR (from Economist, April 2006, pp. 10-11. 90.7 to 77.2 percent). 3 Wall, Howard J. “Recessions, Expansions, and Black Employment.” Federal We can see a more complete picture of these overall gender Reserve Bank of St. Louis The Regional Economist, October 2003, p. 19. differences if we compare the change in LFPR across races. Since 1973, changes in LFPR among whites, blacks, and Hispanics have been relatively consistent: Men’s LFPRs Labor Force Participation Rate have declined slightly and women’s LFPRs have risen. Specifically, from 1973 to 2005, the overall declines for Percent 85.0 black (6.0 percentage points), Hispanic (1.4 percentage points), and white (5.4 percentage points) men are of simi80.0 lar magnitude. The overall rises for black (12.3 percentage 75.0 points), Hispanic (14.3 percentage points), and white (14.8 70.0 percentage points) women mirror each other as well. 65.0 Of course, specific differences do exist in LFPRs 60.0 among races, as the chart shows. For instance, LFPRs 55.0 for white and black men have steadily declined at about 50.0 the same rate, whereas the rate for Hispanic men has 45.0 remained around 80 percent the entire period. As for women, the upward trend in LFPR for white women 40.0 began leveling off in the early 1990s. In contrast, Hispanic and black women saw a rather sharp rise in Hispanic Men White Men Black Men Hispanic Women Black Women White Women LFPR during the economic expansion of the 1990s. SOURCE: LFPR numbers come from the Bureau of Labor Statistics. Also notice that the LFPR has been much more variable for blacks and Hispanics than for whites. 19 73 19 75 19 77 19 79 19 81 19 83 19 85 19 87 19 89 19 91 19 93 19 95 19 97 19 99 20 01 20 03 20 05 T Views expressed do not necessarily reflect official positions of the Federal Reserve System. research.stlouisfed.org