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Where Are the Workers?

Associated Press (06/16/14) Tom Raum

The workforce participation rate held steady in May at only 62.8%, leading many to wonder where the missing workers have gone. There are concerns that the workforce participation rate is being held down by unemployed workers dropping out of the job market after a year or more of looking for work and failing to find it. Rutgers University public policy professor Carl Van Horn says older workers not yet old enough to retire but unable to find another job account for many of these long-time unemployed workers.

Van Horn expects that at some point the strengthening economy will prompt some of these discouraged workers to return to the labor market, but Economic Policy Institute chief economist Heidi Shierholz says this has not happened yet because “employers haven’t seen demand for their stuff pick up in a way that would require them to bring on more workers, put that factory back on line, [and] get more people to work.” Although the labor market is improving, experts say it could be a long time before the jobless rate returns to 5% or less, and the new norm could actually be 6% or more.

“Our economy is leaving our unemployed folks further and further behind,” says Robert A. Funk, chairman and chief executive of the Oklahoma City-based staffing firm Express Employment Professionals. “But if people quit looking for work at a rate like this, it makes our job much, much more difficult.”