Sunday, November 14, 2010

Analyze this graph for me. Why have 16 to 19 year olds been dropping out of the labor force so dramtically for the last 10 years? Any ideas?

I am curious about this graph, especially the purple and red lines. The graph shows the Labor Force Participation Rate (for each group, the number employed or are who are looking for a job, divided by the number of people in that age group times 100) for different age groups. The red line is for ages 16 to 19 and the puple line is for ages 55 and over.  They intersect in late 2009. The slope of the line becomes much steeper for the 16 to 19 age group, indicating a rapidly declining participation rate for this age group. Now, go back to when this trend started to appear, approximately January 2001.  At this point, we can see there is a rather dramatic downward trend in the 16-19  participation rate.  Why did this happen?  What changed in our economy/society to create this trend? I have my guess, but will give extra credit for good responses.   

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