A recent article in the Wall Street Journal describes a shrinking U.S. workforce. The labor force participation rate has fallen to 63.2%, the lowest it's been since 1978. First of all, what does this mean? Second of all, where is everyone going? And finally, what does this mean when you're hunting top performers?
Labor Force Participation Rate: What does this mean?
The labor force participation rate is not to be confused with the "unemployment rate." The unemployment rate demontrates the number of citizens who are unemployed and looking for work. The labor participation rate, on the other hand, describes the number of citizens over 16-years-old, who are not currently employed and are not looking to be employed.
Where is everyone going?
The participation rate has been heavily influenced by employment trends among women. World War II brought a surge of women into the work force, steadily driving the overall participation rate up, up up. Also, as the cost of living shot past the typical employee's earning potential, many families became less able to survive on one income. Children went to daycare, and both parents went to work.
Some in the know feel the downturn is due in part to the retirement of an aging population. However, the trend may also mean that the cost-benefit of work is off balance. That is to say, it may cost more to work (e.g., child care and returning to school for special certification and degree programs) than it pays to work (the available jobs may be too low paying).
What does this mean in your search for top performers?
The biggest drops in labor force participation are among individuals with four-year or higher college degrees. At the same time, participation rates among those without high school diplomas has remained fairly steady. This is concerning when you're looking for skilled and knowledgeable candidates. What can you do about it?
We've touched on this before: beyond a paycheck, what does your company have to offer? Do you offer time and compensation for employees to complete certification and degree programs? If you don't currently, could you? In what ways might this expand your reach? Do you offer on-site child care or partnerships with local providers for discounted rates? Would that be enough to reset the cost-benefit balance of work to pull strong performers back into the work force?
SwoopTalent can help you access the strongest candidates for your team. Contact us today!