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Women entered the workforce in exponentially increasing numbers. It allowed us to grow faster than we otherwise would have. That tailwind is now gone.
Source Data:
St. Louis Fed: Labor Force Participation Rate - Women
Friday: No Major Economic Releases
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Friday:
• At 10:00 AM ET, *University of Michig...
8 hours ago
12 comments:
It is a little surprising that this trend broke in 1990, but it took another 10 years for everything else to break.
Was is massive credit growth that allowed the other trends to continue, or something else. Fascinating.
Mr Slippery,
I'm thinking that maybe we thought up something else in the early 1990s to temporarily fill the gap. Just a hunch. Sigh.
IMO, the internet/dot.com boom filled the gap. Capital flowed from all over the world to the US; unemployment rates were so low that employers seeking unskilled labor brought in the disabled to fill the gap. (Fast food joints and such). What minimized wage inflation was the large number of people working for stock options/startups. If you did that and your company failed, you'd been working for free.
And of course there was a finite number of women available to enter the workforce; this trend would have broken regardless of overall economic conditions.
This is even more disturbing.
http://research.stlouisfed.org/fred2/series/LNS11300001
JzB
Hmmm.
'Lump of labor fallacy' canard?
I guess we have an export economy but with U-6 at 15% ISTM we have too many wanna-be workers and not too few.
So much of our economy is just consumption. This, by definition, is not wealth-accreting, which is what we actually need to focus on (i.e. paying our way in the world again).
What, praytell, inspired this chart? Is the wife not working hard enough??? ;-)
Scott,
IMO, the internet/dot.com boom filled the gap.
I think that's true as well.
Scott,
And of course there was a finite number of women available to enter the workforce; this trend would have broken regardless of overall economic conditions.
Indeed. The exponential growth in the participation rate was pretty much guaranteed to fail at 100%.
Jazzbumpa,
Believe it or not that chart shows an exponential trend failure too.
I'll do a post to show it, if only because it is an "even more disturbing" kind of failure.
My eye sees an exponential decay with a sudden lurch lower.
Troy,
It would be nice to pay our way in the world again. It will happen someday unless one thinks that unsustainable trade deficits can remain permanent. Sigh.
tj and the bear,
As with most recent exponential trend failure charts, I have Jeremy Siegel to thank, lol.
His belief that 200 years of exponential prosperity growth can be simply extrapolated into the distant future inspires me to find charts such as these.
That said, my girlfriend has been unemployed for a few years. She's back in school to become a nurse. I'm really hoping that she participates in the workforce again! ;)
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