The proportion of the population available to work, that is,
the labor-force participation rate in America is just 62.7%, the lowest level
since 1977. This has big implications for wages in America for future.
According to simple economics, if participation rate
increases, wages decline, however, if participation rate decreases, wages rise.
It was due to the recession that participation rate decline. But, the article
warns that better economic conditions will not increase the participation rate.
This is because there is plenty of capacity for those already employed to work
longer hours. The number of full-time jobs are lower than before the recession
hit, part-time jobs are higher, and fewer people now hold multiple jobs. This
shows that Americans are not being able to work as much as they would like to
increase their spending.
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