Recent fluctuations in the labor force participation rate have received national attention. And there’s an obvious question here, with ramifications for how we view that number: Why would a working-age person not be in the labor force?
In June 2008, the Current Population Survey added a question about disability status. It turns out that a non-trivial number, about 1 in 5, report a disability that limits their capacity to work. The graph above shows that the number of persons out of the labor force who have a disability has been steadily rising and that there are more women than men in this group. The average increase has been about 1.9% year-over-year, with a slightly higher rate for men than women: 2% vs. 1.8%. These rates are significantly faster than population growth or the growth in the labor force. In other words, we’re seeing a piece of the decline in the overall labor force participation rate (i.e., the fraction of the working-age population who work or are actively trying to find work).
Although many physically demanding jobs have historically been male-dominated, more women report being out of the labor force because of a physical disability. Part of the reason is that there are more women who do not participate in the labor force. The disability questions also identify anyone in the household with a disability, so we may be seeing women staying out of the labor force to help care for a disabled member of the household.
The bottom graph shows the fractions of those out of the labor force: About 1 in 4 working-age men who are not in the labor force have a disability, whereas only 1 in 6 women do. The bottom graph also shows that the increasing trend (seen in the graph above) is right in line with the overall trend in non-participation. The fraction of workers out of the labor force because of disability is approximately constant, meaning that non-participants without a disability are rising at the same rate as those with a disability.
How these graphs were created: For the top graph, simply search for “not in labor force disability 16 64 men” and then the same series for women. For the bottom graph, use the same series (as the “a” series) and add the “no disability” versions (as the “b” series) with the “Add Data Series” / “Transform Data Series” options. Then apply the formula a/(a+b).
Suggested by David Wiczer.
View on FRED, series used in this post: