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It is better
to not be on
the web than
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not know why

John Sumser

is more
it seems.
John Gall


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(November 06, 2003) - Remember, our deep look at statistics began with a question about longer term labor shortages. So far, our analysis has assumed that everyone who leaves the workforce comes back. They do not.

Although much is made in the press about the people who leave the workforce and end up in despair, there is a more regular (and relatively permanent) form of workforce attrition. Death, retirement and disability (all generally a function of age)  are all covered in a BLS category called "Other Separations (OS). When OS is taken into consideration, the economy appears to have made major strides in the last couple of years.

Other Separations (OS) appears to grow at a very steady rate. Death, retirement and disability account for a 3.5% change in the workforce each year. The number of workers leaving the labor force for these reasons peaks in the fourth calendar quarter each year.

The blue line (Supply minus Other Separations) shows the cumulative deficit in the labor supply if there were no new entrants. In other words, the blue line shows the cumulative impact on the work force of death, retirement and disability during the past couple of years. According to these BLS statistics, we have been able to absorb about 6 Million new workers during the recession.

Of course, this doesn't tell you whether or not the jobs were equivalent or anything qualitative about the overall standard of living for the workforce. To completely understand the impact of retirement (OS)  we'll have to take a look at the flow of new entrants tomorrow.

John Sumser

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