Home' Trinidad and Tobago Guardian : September 8th 2013 Contents A39
September 8, 2013 www.guardian.co.tt Sunday Guardian
WASHINGTON---The drop in the
unemployment rate in August to a
four-and-a-half-year low was
hardly cause for celebration. The
rate fell because more people
stopped looking for work.
More than 300,000 people
stopped working or looking for a
job. Their exodus shrank the so-
called labour force participation
rate---the percentage of adult Amer-
icans with a job or seeking one---to
63.2 per cent. It s the lowest par-
ticipation rate since August 1978.
Once people without a job stop
looking for one, the government no
longer counts them as unemployed.
That s why the unemployment rate
dropped to 7.3 per cent in August
from 7.4 per cent in July even though
115,000 fewer people said they had
If those who left the labour force
last month had still been looking for
work, the unemployment rate would
have risen to 7.5 per cent in August.
"Pretty disappointing," said Beth
Ann Bovino, US chief economist at
Standard & Poor s Ratings Services.
"You saw more people leave the
job market and fewer people get jobs.
Not a good sign."
Back in 2000, the participation
rate hit a high of 67 per cent. At the
time, women were pouring into the
labour force. But women s partici-
pation fell modestly through the
mid-2000s---then dropped sharply
from late 2009 through 2013.
Women s participation rate was
57 per cent last month, down from
a peak of 60 per cent in 2000.
For men, the participation rate
last month was nearly 70 per cent.
Their participation peaked in 1949
at 87 per cent and has declined grad-
ually in the decades since.
In a 2011 report, the Congressional
Budget Office noted that the recent
drop in women s participation was
particularly steep among those with
dependent children and well-edu-
cated women married to high-earn-
Another factor in the declining
participation is that the oldest baby
boomers have reached retirement
But Craig Alexander, chief econ-
omist at TD Bank Group, says
"demographics cannot explain the
amount of decline" in labour force
Many Americans without jobs
remain so discouraged that they ve
given up on the job market. Others
have retired early. Younger ones have
enrolled in school.
Some Americans have suspended
their job hunt until the employment
landscape brightens. A rising number
are collecting disability checks.
"It s not necessarily people retir-
ing," Bovino says.
"It s young people going back to
school" rather than taking their
chances on a weak job market.
Labour force participation for
Americans ages 16 to 19 was just 34
per cent last month. That s near their
record low of 33.5 per cent set last
It isn t supposed to be this way.
After a recession, a brightening econ-
omy is supposed to draw people back
into the job market. But it hasn t
happened. Labour force participation
"certainly shouldn t be at current
levels," Alexander says.
There aren t enough jobs being
filled. Employers are hiring about
4.3 million people a month---before
layoffs, dismissals and resignations.
In 2007, before the Great Recession,
they were hiring 5.2 million a month.
There are three unemployed peo-
ple, on average, competing for each
job opening, compared with 1.8 when
the recession began in December
Why fewer working-age
Americans are working
NEW YORK---The stock market
is ending flat after a morning of
Traders weighed a weak jobs
report for August and tensions
between the US and Syria on Fri-
The Standard & Poor s 500 index
rose less than a point, or 0.01 per
cent, to close at 1,655.17. The Dow
Jones industrial average ended down
14 points, or 0.1 per cent, at
14,922.50. It was down as much as
148 points shortly after trading
The Nasdaq composite rose one
point, or 0.03 per cent, to 3,660.01.
The yield on ten-year Treasury
notes fell as investors anticipated
that the Federal Reserve would keep
up its bond purchases to help the
economy. The yield dropped to 2.93
per cent from three per cent late
US employers added 169,000
jobs last month, fewer than econ-
Stock market finishes flat after wild start
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