Many people focus upon the fact that the official U.S. unemployment rate is below five percent. But that number can be misleading since it doesn’t include discouraged workers – people who would like to be working but gave up looking for a job.
The percentage of prime-age men, those ages 25 to 54, who have a job or are actively searching for one has been declining for decades. As indicated by Bloomberg, during the mid 1950s, 97 percent of prime age men were in the labor force. In 2014, that fell to a record low of 88 percent.
There are other reasons to question how meaningful the official unemployment rate is and for that reason many economists use an array of other metrics to characterize the labor market. One of the most popular alternative measures is the employment-to-population ratio.
If one looks at this indicator, America’s recovery from the financial crisis remains only partial. When the recession began in very late 2007, the employment-to-population ratio for people ages 25 to 54 stood at around 80 percent. Today, that number stands at around 78 percent, but that’s better than the 75 percent figure that prevailed during the downturn’s aftermath.
