The U.S. labor force has undergone significant changes in recent decades, with aging and diversification being the main factors driving these shifts.
Firstly, the population is getting older. In 1979, elderly workers aged 65 and above accounted for only 3% of the labor force, while teenagers aged 16-19 comprised 8.2%. Fast-forward to 2019, and the scenario has flipped. Elderly workers now account for 6.6% of the labor force, while their teenage counterparts make up just 3.2%. Moreover, the number of people between 55 and 64 years old has increased by 5.5 percentage points to 17.2%, while the number of 20-24-year-olds has decreased by 6 percentage points to 8.5%.
Joe Piacentini, an adviser to William Beach, Commissioner of Labor Statistics, attributes these demographic shifts primarily to the aging baby boomer population but not solely. Factors such as medical advancements, less manual labor, and lower youth employment rates are also contributing factors.
Secondly, the labor force has become better educated. In 1979, 68% of the workforce was married, while now, only 52% are. The decline in marriage rates can be attributed to various factors, including education levels, religious participation, and financial pressure. Furthermore, the American workforce is now more educated, with the percentage of people holding a bachelor's degree increasing from 17% in 1980 to approximately 34% in 2015.
Lastly, the U.S. labor force has become more diverse. Over the years, the percentage of non-white workers has risen from 11.7% in 1979 to 22.3% in 2019. Additionally, the percentage of Hispanic or Latinx workers has increased from 5% to 18%. Moreover, women's labor force participation has significantly increased over the years. While it spiked during the 1960s and 1980s, it leveled off during the 1990s. However, the Covid-19 pandemic has disproportionately affected women in the workforce, due to their dominance in industries that have suffered the most and the closure of schools and childcare facilities.
As the U.S. workforce continues to evolve, businesses must adapt their hiring and retirement policies. Understanding these shifts and implementing strategies to accommodate them can help them remain competitive in a rapidly changing global economy.
