what is the labor force participation rate 
the labor force participation rate is an estimate of an economy s active workforce the u s government s labor force participation rate formula is the number of people ages 16 and older who are employed or actively seeking employment divided by the total non institutionalized civilian working age population in the 12 months ending june 2024 the u s labor force participation rate remained flat at 62 6 according to the bureau of labor statistics bls which publishes the figures monthly in june 2024 it was 62 6 1from 2013 on the monthly figures held steady in the vicinity of 63 after a sharp decline during the great recession however with the onset of the covid 19 pandemic in early 2020 the labor force participation rate fell dramatically dropping from 63 3 to 61 5 in the first half of the year the low point was reached in april 2020 when the rate sank to 60 1 1understanding the labor force participation ratethe labor force participation rate is an important metric to use when analyzing employment and unemployment data because it measures the number of people who are actively job hunting as well as those who are currently employed it omits institutionalized people such as individuals in prisons nursing homes or mental health facilities and members of the military 23it includes all other people aged 16 or older and compares the proportion of those who are working or seeking work outside the home to those who are neither working nor seeking work outside the home 43the labor force participation rate is considered to be somewhat more reliable than the unemployment rate because it accounts for people who have given up looking for work the unemployment numbers do not take into account those who have given up looking for work 5some economists argue that the labor force participation rate and unemployment data should be considered together to better understand an economy s real employment status labor force participation rate formulathe formula for labor force participation is number employed number seeking work 100 civilian non institutional population begin aligned frac text number employed text number seeking work times 100 text civilian non institutional population end aligned civilian non institutional population number employed number seeking work 100 this applies to all members of the population at age 16 or older factors that affect the participation ratelabor force participation is affected by numerous social economic and demographic factors as these factors change labor force participation goes up or down these changes can happen quickly or slowly they might have a short term impact on labor force participation or they might create long term change short and long term economic trends influence the labor force participation rate in the long run industrialization and the accumulation of wealth can have an impact industrialization tends to increase participation by creating employment opportunities high levels of accumulated wealth can reduce participation because wealthier people simply have less need to work for a living in the short term business cycles and unemployment rates influence the participation rate during an economic recession the labor force participation rate tends to fall because many laid off workers become discouraged and give up looking for jobs economic policies such as heavy labor market regulation and generous social benefit programs may tend to decrease labor force participation social expectations and changes to those expectations affect who is available to participate in the workforce as different groups are expected to work or not the labor force participation rate will go up or down for example if married men are considered responsible for supporting their families while married women are encouraged to stay home women will stop working once married or after having children which lowers the labor force participation rate if the expectation is that both parents should be able to work some parents of either gender will opt to stay in the workforce educational expectations impact the labor force participation rate if more young people learn a trade or a family business as they are growing up and skip college adults start entering the workforce between the ages of 17 and 19 in countries or demographic groups where a college degree is regarded as a necessity more young adults will continue their education after high school labor force participation will go down because they won t join the workforce until their early or mid twenties changes in the working age population from generation to generation influence labor force participation as large age cohorts reach retirement age the labor force participation rate can fall for example the retirement of a steady stream of baby boomers has reduced labor force participation baby boomers are one of the largest demographic blocks in the population since generations after the baby boomers are smaller they will not be replaced by as many active younger workers when they retire 6trends in the participation ratethe labor force participation rate has changed based on economic social and demographic trends over the long term it rose steadily through the second half of the 20th century peaking at 67 3 in april 2000 as the great recession hit in 2008 the participation rate entered several years of steep decline stabilizing at around 63 by 2013 7the trend in the women s labor force participation rate largely parallels the long term trends for the overall population the women s labor force participation rate nearly doubled from 32 to 60 in the 50 years from 1948 to 1998 this rate dropped to 54 6 in april 2020 from 57 9 in february 2020 as of june 2024 it sits at 57 3 89the u s labor force participation rate of 62 6 in june 2024 included 57 3 participation for women and 68 1 participation for men 8