Between December 2007 and December 2013, the labor force participation rate of people aged 16 or older fell from 66.0 to 62.8 percent. How much of that decline is due to the Great Recession and how much is due to the aging of the large baby-boom generation?
A substantial 40 percent of the decline is due to the aging of the baby-boom generation, according to an analysis of the data by Alicia H. Munnell, director of the Center for Retirement Research at Boston College. Although boomers are staying in the workforce longer, the labor force participation rate of older workers is still less than half the rate of prime-age individuals, notes Munnell. The growing presence of Americans aged 55 or older in the population is reducing the overall labor force participation rate. "Regardless of general economic factors, we should expect to see labor force participation continue to decline for the remainder of this decade due to the retiring of baby boomers," she concludes.
Source: Center for Retirement Research at Boston College, The Impact of Aging Baby Boomers on Labor Force Participation
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