The relationship between changing of labor force(total labor number ) Essay

The relationship between changing of labor force(total labor number ) and Unemployment rate - Essay Example Majority of employees are either young or old. The labor participation rate for women is lower than originally estimated. Experts argue that the number of women in the labor force will increase as soon as the economy recovers. The labor participation rate often affects the unemployment rate in the economy. It is important to note that with lower labor participation rate, with the same level of unemployment, there will be lower unemployment rate(McBride 1). If the employment growth could continue, for example, 250,000 jobs a month in 2012, and the participation rate (63.7% in 2012), statisticians predicted a 7.3% fall in December 2012 (McBride 1). For this reason, the higher the labor participation rate, then there will be a reduction in the unemployment rate. This study will be useful in explaining why changes in the labor force will mask gains in the jobs situation (McBride 1). Currently, the unemployment rate has reduced significantly, since the Great Recession. However, the labor force has not changed. A research by McBride, he defined the labor participation rate as the percentage of Americans at the working-age, who are either working or looking for jobs. Statistics indicate that the labor participation rate is at a 35-year low. Many people lay the blame for this rate to the economy, which has not been constant. Experts argue that the fall in the unemployment rate is because of the decline in the labor force participation (McBride 1). Reports indicate that the US labor force has changed positively because of demographics. Additionally, the same reports indicate that the US labor force keeps shrinking. During the previous years, the unofficial unemployment rate kept dropping even though job creation has been relatively soft (McBride 1). For instance, during the past four months, the U.S government created 150,000 jobs a month (McBride 1). However, the unemployment rate has been dropping precipitously. What is the reason for this? From