ECONOMIC

volume and the prices of farm exports from the United States. Third, thedepreciation of the U.S. dollar helped to increase exports from the UnitedStates and to restrain the growth of imports.THE LABOR MARKETWith aggregate output up substantially for the second year in a row thedemand for labor remained strong. Civilian employment increased by 2.7million persons in the course of the year, while the civilian labor force grewby 2.6 million. The 3.3 percent rise in employment was the largest December-to-December percentage increase since 1955. Unemployment declinedthrough the first 3 quarters of the year and then edged up.THE LABOR FORGEThe civilian labor force expanded sharply during 1973 and for the entireyear was 2.1 million above the average level in 1972. This 2.5 percent increasefollowed a 1972 gain of similar proportions and substantially exceededthe average rise of 1.8 percent a year in the preceding decade.The civilian labor force can be augmented in three ways: (1) Throughreductions in the Armed Forces; (2) through population increases in theworking-age groups; and (3) through increases in the proportion of the populationseeking work. By 1973 reductions in the Armed Forces had ceasedto be a major factor in enlarging the civilian labor force. For the year as awhole the Armed Forces averaged about 100,000 less than in 1972, a markedcontrast to the reductions of 400,000 which occurred in both 1971 and 1972.The 1.7 percent increase in the working-age population was in line with thelong-term trend. The main factor accounting for the larger than averageincrease in the civilian labor force in 1973 was the sharp rise in the participationrate. In the fourth quarter of the year a record 61.2 percent ofthe civilian working-age population participated in the labor force, a largeincrease from the 60.4 percent participation rate a year earlier. In 1972 and1973 the movement toward increased labor force participation was reinforcedby the large expansion in demand.The rise in participation was most pronounced for women from ages20 to 24. In 1973, 61 percent of women in this age group were eitherat work or looking for a job, compared to 58 percent in 1971 and only46 percent as recently as 1960. The long-term upward movement in theparticipation rate for young women has several causes. There has been atrend toward smaller families and toward starting them later. In addition,mothers with preschool children have increased their work outside thehome. The continued strong expansion of the service industries, whichtypically employ a large percentage of women, the relative increase inuniversity training of young women, and the broadening of all women'semployment opportunities have contributed to this trend.Men in the 20 to 24 age group also sharply increased their participationin the civilian labor force for the second year in a row, following 10 years57