Participation fell to 63.7% which is the lowest level in at least 10 years according to the Bureau of Labor Statistics while CNBC Business News reports the last time we had a labor force participation rate as low as 63.7% was in May, 1983.
The nonfarm economy created 243,000 jobs in January, but much of the drop in unemployment is the result of discouraged workers leaving the job market. That includes early retirements, people going on disability, or simply giving up the search. Rick Santelli of CNBC makes this point too.
If enough people decide not to look for work, the unemployment rate can drop even further. That doesn't mean the economy is improving, quite the opposite. As labor force participation shrinks, fewer workers are supporting more non-workers, one way or another. Hat tip to Drudge for the links.
