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November 2009, Vol. 132, No. 11
Data in table 7 (page 50) were corrected online December 29, 2010. See Errata online at www.bls.gov/opub/mlr/2010/12/errata.pdf.
Labor force projections to 2018: older workers staying more active
Mitra Toossi is an economist in the Office of Occupational Statistics and Employment Projections, Bureau of Labor Statistics. E-mail: Toossi.Mitra@bls.gov
As the baby-boom generation ages, the share of workers in the 55-years-and-older age group will increase dramatically; the participation rates of older workers in the labor force are expected to increase, but will remain significantly lower than those for the prime age group, and, as a result, the participation rate and overall labor force growth rate will decline.
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The U.S. labor force is undergoing a gradual but significant change. Beginning in the latter part of the 20th century, three major demographic trends—slowing growth, aging, and increasing diversity—led to changes that have had a considerable impact on the profile of the labor force in the United States and are projected to affect the workforce in the foreseeable future.
Slowdown in the growth of the labor force. The high growth rate of the labor force from the 1970s to the 1990s has been replaced by a much slower growth since 2000. The slow growth rate of the labor force is expected to continue over the next decade.
Aging of the labor force. With the aging of the baby-boom generation, defined as persons born between 1946 and 1964, the older age cohorts are expected to make up a much larger share of the labor force. In 2008, the baby-boom cohort was 44 to 62 years of age. By 2018, almost all the baby boomers will be in the 55-years-and-older age group. Age is a major factor in labor market behavior, and the aging of the labor force will dramatically lower the overall labor force participation rate and the growth of the labor force.
Changes in the racial and ethnic composition of the labor force. As a result of higher population growth—stemming from an increased number of births and increased immigration—and high labor force participation rates by Hispanics and Asians, the share of the workforce held by minorities is expected to increase significantly.
In addition to exploring these trends, this article describes the labor force projections by the Bureau of Labor Statistics (BLS) for the 2008–18 timeframe, for 136 demographic groups broken down by age, sex, race, and Hispanic origin. The dynamic factors that have led to changes in the composition of the workforce resulting from persons entering, leaving, or staying in the labor force also are highlighted. Finally, the article discusses the median age of the labor force for the different groups, along with the economic dependency ratio in the labor force.1
This excerpt is from an article published in the November 2009 issue of the Monthly Labor Review. The full text of the article is available in Adobe Acrobat's Portable Document Format (PDF). See How to view a PDF file for more information.
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1 The projections presented supersede those described by Mitra Toossi in “Labor Force projections to 2016: more workers in their golden years,” Monthly Labor Review, November 2007, pp. 33–52. The BLS carries out labor force projections every 2 years based on the most recent demographic data.
Labor force projections to 2016: more workers in their golden years—Nov. 2007.
Labor force projections to 2014: retiring boomers.—Nov. 2005.
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