Summary
This Issue Brief examines the U.S. civilian labor force through December 2022, using data from the U.S. Census Bureau’s Current Population Survey, available through the Bureau of Labor Statistics. First, it investigates the trends in labor force participation rates of those ages 55 or older by age and gender. It also explores labor force trends for those ages 16 or older. Along with the labor force participation rates, the age and gender composition of the labor force and the adult population are investigated, allowing for the identification of key labor force and population trends. Finally, there is an analysis of how the labor force and employment changed from 2019–2022 for individuals of various ages, genders, and races and ethnicities. Key findings include:
- In 2021 and 2020, among males, the labor force participation rates of those ages 55–69 increased, but they declined for those ages 70 or older. Increases in the labor force participation rates of females ages 55–59 and 60–64 also resulted in 2021 and 2022, but the labor force participation rates decreased for females ages 65–69 and increased for those ages 70–74 in 2022.
- In 2022, the male share of the labor force (highest since 2001) ages 55 or older increased. Despite the falling share of the labor force since 2010, females ages 55 or older are still a significantly higher share of the labor force than they were in as late as the 1990s.
- In 2021 and 2022, the labor force participation rates of those ages 25–54 trended toward their 2019 levels but did not quite reach them. The labor force participation rates of those ages 16–19 and ages 55–64 reached or surpassed their 2019 levels. In contrast, the labor force participation rate of those ages 65 or older in 2021 and 2022 stayed at its 2020 level, below its 2019 level, while the labor force participation rate of those ages 20–24 decreased in 2022 below its 2021 and 2019 levels.
- The male employment rate dropped by 3.8 percentage points in 2020, while the female rate had declined by 3.5 percentage points. By 2022, the difference in the employment rates of males and females from 2019 had nearly recovered to only 1 percentage point below their 2019 levels.
- By 2022, Black Americans had made the biggest recovery, as their 2022 labor force participation rate was only 0.8 percentage points below its 2019 level, while the other two race/ethnicity categories studied had differences of at least 0.9 percentage points between their 2019 and 2022 levels.
While Black and Hispanic Americans were more likely to not be employed in 2020, they made a faster recovery than White Americans, where the number of Black and Hispanic Americans employed in 2022 was larger than it was in 2019. Thus, companies face more urgency in addressing labor force issues around race/ethnicity so that they can develop a strong work force. In addition to race/ethnicity, the age of the labor force will also play an important role in companies’ work force development. At present, the aging of the Baby Boom generation has resulted in an increased share of older individuals in the labor force. However, members of this generation are almost all at least in their 60s, and the next generation (Gen X) is much smaller, so the share of workers ages 55 or older will soon be decreasing.
A continued strong labor market will likely lead to the labor force participation rates and employment population rates of 2019 being reached. However, a downturn in the economy would likely halt the movement back to 2019 levels, and who is out of the labor force after any downturn could significantly alter what companies’ work forces look like and what Americans have saved for retirement.