Welcome back dropouts: data suggests Americans rejoining workforce
By Howard Schneider and Jason Lange
WASHINGTON (Reuters) - For the first time in six years, the share of people who either have a job or are looking for one is on the rise in a majority of U.S. states, a sign one of the deepest scars of the economic crisis could be healing.
Most states have experienced sharp declines in labor force participation since the 2007-2009 recession, but a Reuters analysis of government data found a reversal could be underway.
The data bolsters Federal Reserve Chair Janet Yellen's view that America has ample room to create jobs without causing uncomfortably high inflation and it buttresses arguments for keeping interest rates low. If Yellen is wrong, the Fed's easy money policies could lead employers to bid up wages for scarce talent, stoking price increases.
Anecdotal reports suggest that in many parts of the country, demand for labor appears to be growing enough to get people who had dropped out of the workforce to restart their job hunts.
"We are getting more job creation and we are seeing more people come in," said Paul Turek, a labor economist with Washington state's Employment Security Department.
Washington is one of 32 states where the participation rate rose in the six months through April, according to the Reuters analysis. Together, these states account for a majority of the nation's working-age population.
It was the second straight month where most states chalked up gains over a six-month period.