Macroeconomic data

Labor Force Participation Rate

The labor force participation rate (LFPR) equals labor force divided by population. Female LFPR grew steadily after WWII, then plateaued in the noughts. Male LFPR mostly declined, due to an increasing number of males in retirement. Especially teenagers experienced a reduction in LFPR during the 21st century. Note the conspicuous reduction in LFPR during and following the Great Recession. Much of this is due to retirement of Baby Boomers; some portion is due to discouraged job-seekers dropping out of the labor force.

Unemployment Rate

The unemployment rate for adult men and women are of similar magnitude, while teenagers have a much higher rate. Note that the unemployment rate lags, in that it peaks at the end or even after a recession (the pink bars). In the recovery after the most recent recession, teenager unemployment has reached historically high levels, and male unemployment has exceeded that of females.

Natural rate of unemployment

The natural rate of unemployment (NAIRU) is the unemployment rate net of cyclical unemployment (i.e., it considers only seasonal, frictional, and structural unemployment). The short-term NAIRU indicates the threshold for which inflation would ignite, should the actual unemployment rate fall below that level.

Labor market tightness

Subtracting the actual unemployment rate from the NAIRU gives a measure of labor market tightness (higher values indicate increased bidding up of wages). As can be seen in the figure, labor market tightness often leads changes in the CPI inflation rate.