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More job seekers give up, reducing unemployment

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WASHINGTON – Where did all the workers go?

The labor force — those who have a job or are looking for one — is getting smaller, even though the economy is growing and steadily adding jobs. That trend defies the rules of a normal economic recovery.

Nobody is sure why it's happening. Economists think some of the missing workers have retired, have entered college or are getting by on government disability checks. Others have probably just given up looking for work.

"A small work force means millions of discouraged workers, lower output in the future and a weak recovery," says Rep. Kevin Brady of Texas, the ranking Republican on the Congress' Joint Economic Committee. "Those are unhealthy signs."

By the government's definition, if you quit looking, you're no longer counted as unemployed. And you're no longer part of the labor force.

Since November, the number of Americans counted as employed has grown by 765,000, to just shy of 139 million. The nation has been creating jobs every month as the economy recovers. The economy added 244,000 jobs in April.

But the number of Americans counted as unemployed has shrunk by much more — almost 1.3 million — during this time. That means the labor force has dropped by 529,000 workers.

The percentage of adults in the labor force is a figure that economists call the participation rate. It is 64.2 percent, the smallest since 1984. And that's become a mystery to economists. Normally after a recession, an improving economy lures job seekers back into the labor market. This time, many are staying on the sidelines.

Their decision not to seek work means the drop in unemployment from 9.8 percent in November to 9 percent in April isn't as good as it looks.

By PAUL WISEMAN, AP Economics Writer 

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Author of this article: Paul Wiseman
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