Men jumped back into job search in February
The share of adults participating in America’s labor force grew in February, as men in their prime working years increasingly found or searched for jobs and as many racial groups traced gains — a welcome sign for economic policymakers and employers trying to gauge whether and when employees will return.
The overall participation rate nudged up to 62.3 percent from 62.2 percent in January, hitting its highest level since March 2020, and the details of the data showed especially strong gains among a few demographics.
Men between the ages of 25 and 54 participated at the highest rate since March 2020, 88.8 percent, down just slightly from their 89.2 percent participation rate before the onset of the pandemic, which caused abrupt job losses and sharply reduced labor force participation overall.
Among racial groups, participation climbed for white, Black and Hispanic people in February. Black and white people are participating in the job market at the same rate — 62.2 percent — which is a change from the decades before the pandemic, when Black people tended to be less attached to the job market than their white counterparts.
Black men in particular entered the labor market last month, with their adult participation rate jumping to its highest level since 2018. That progress came even as the group’s unemployment rate declined, suggesting that the men are finding jobs.
Although participation has been creeping back up across demographic groups, Black men are something of an anomaly in posting such a full recovery (though their rebound reflects just one month of data, so it could reverse). Labor-force participation remains well shy of its pre-pandemic levels for most groups, and it is not clear if, or when, it is going to fully rebound.
Jerome Powell, the Federal Reserve chair, said during congressional testimony this week that “we’re short workers” because of the decline in labor-force participation during the pandemic, and although “some of that is voluntary” and owes to retirements, some might be more reversible.
The Fed’s latest monetary policy report, which it sends to Congress twice a year, suggested that retirements accounted for by far the biggest chunk of the decline in participation since the start of the pandemic, while caregiving and coronavirus fears counted for a smaller but meaningful amount of the decline.
Whether employees come back will matter a lot for the economy. Workers have been in short supply in recent months, which is making it hard for employers to provide the goods and services that consumers demand.
If employment does rebound, that will allow the economy to grow more sustainably and, in theory, with less inflation as it produces more goods and services to keep up with consumption and as wages grow at a more moderate pace.
The latest report offers hopeful signs of a worker comeback.
“The data indicate the labor market has positive momentum and is continuing to make rapid progress,” Rubeela Farooqi, chief U.S. economist at High Frequency Economics, wrote in a research note after the release.