ECONOMIC

Since the mid-1950s a dramatic change in the composition of the laborforce has apparently led to an increase in the movement of workers in andout of the labor force. High rates of labor force turnover generally increasemeasured unemployment, since first entry and reentry into the labor forcegenerally involve a period of job search and are counted as unemployment inthe labor force statistics. Hence for approximately the same tightness in thelabor market, the measured unemployment rate will be higher if a largerproportion of job seekers are persons formerly outside the labor force.Data on reasons for unemployment indicate that the high rates of laborforce entry and reentry account for most of the higher unemployment ratesamong youths compared with adults, and that the unemployment rates forjob losers and job leavers differ very little among demographic groups (Table4). Youths are far more likely than adults to combine work in the labormarket with some other activity such as schooling or work at home. Studentsmove in and out of the labor force in search of part-time and full-time employmentduring the school recess, and during the school term many searchfor part-time employment. A rising proportion of youths in the labor forcewould therefore be associated with a rising proportion of new entrants andreentrants—and hence, other things being equal, with a rise in the unemploymentrate. Since the mid-1950s teenagers and young adults have, infact, constituted an increasing proportion of the labor force, from 15 percentin 1955 to 24 percent in 1976, because of the postwar baby boom thathas increased the proportion of youths in the working-age population, andbecause of a rise in the labor force participation rate of students.TABLE 4.—Civilian unemployment rates by age, sex, and reason for unemployment, 1973[Percent]Age and sexAll civilianworkers *Job losers andjob leavers 325 years and over:Men __Women16-24 years:MenWomen2.54.09.911.22.02.34.94.11 Unemployment as percent of civilian labor force in proup specified.2 Unemployment as percent of civilian labor force excluding new entrants and reentrants.Sources: Department of Labor (Bureau of Labor Statistics) and Council of Economic Advisers.The difference between the overall unemployment rate and that for subgroupsof the population has widened markedly since the mid-1950s, partlybecause of these changing labor force proportions (Table 5). The unemploymentrates for adults, experienced workers, and the long-term unemployedin 1965 and 1973, were all roughly equal to the rates in 1956, a year in whichthe overall rate of unemployment approximated the full-employment estimateof 4 percent. Yet for the later years the overall unemployment rate wasmuch higher, rising to 4.5 percent in 1965 and to 4.9 percent in 1973.49