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Work Force Dropout Number Is Worrisome for Labor Market

Wall Street Journal (04/05/13) Ben Casselman

The U.S. work force participation rate slipped to 63.3% in March, marking a 34-year low, as close to 500,000 people exited the labor market. Of these drop outs, more than 50% were under age 25, partly reflecting an increase in college attendance but also indicating that this demographic continues to have troubling finding employment. Meanwhile, the work force participation rate for those age 25 to 54 hit a 29-year low of 81.1%. The rising number of labor force drop outs could affect the economy over the long term, leaving a smaller share of the population to support the economy as millions of Baby Boomers retire. Moreover, those returning to work may have to accept lower-paying jobs or contend with missed early-stage career opportunities that could have boosted earnings later on.