Overlaying a line graph and an area graph: adding recession bars to a time series
Using the data from FRED for both labour data and recession data and slight adjustments to your code I think I get the result you want:
import pandas as pd
import matplotlib.pyplot as plt

# read in data
rec_data = pd.read_csv(&quot;USREC.csv&quot;)
ls_data = pd.read_csv(&quot;LABSHPUSA156NRUG.csv&quot;)

# make sure date columns are actual dates
rec_data[&quot;DATE&quot;] = pd.to_datetime(rec_data[&quot;DATE&quot;])
ls_data[&quot;DATE&quot;] = pd.to_datetime(ls_data[&quot;DATE&quot;])

# create plot
fig, ax = plt.subplots()
ls_data.plot.line(ax=ax, figsize=(8, 5), x='DATE', color=&quot;blue&quot;)
rec_data.plot.area(ax=ax, figsize=(8, 5), x='DATE', alpha=0.5, color=&quot;gray&quot;)
plt.xlim(&quot;1950-01-01&quot;, &quot;2020-01-01&quot;)
plt.ylim(0.58, 0.65)