A new Economic Policy Institute report analyzes historical trends in U.S. labor force participation—including a sharp increase over the past decade.  

The prime-age labor force participation rate (LFPR)—the share of the population between ages 25 and 54 that is working or looking for work—rose sharply from the mid-1970s to the mid-1990s. It was then flat for a period before falling during the mid-2010s, most notably following the Great Recession. But even with the pandemic job losses, labor force participation has rebounded strongly in the last 10 years as a tight labor market attracted workers in search of better opportunities.   

Long-term changes in labor force participation have varied by gender and demographic groups. For instance, those without a college degree—particularly men—experienced steeper declines in participation, due in part to the loss of jobs in sectors that typically employed many noncollege men, such as manufacturing and the military.  

Black men, in particular, experienced notable declines in participation before the strong labor market over the last 10 years returned their participation to its 2000 level. The quadrupling of incarceration rates through the 1980s and 1990s disproportionately impacted Black men, making it harder for them to secure employment because of both the labor market “scarring” effects of incarceration as well as labor market discrimination. 

Women, by contrast, experienced historical gains in labor force participation throughout the 1980s and 1990s but then their participation stalled out in the early 2000s—and began falling behind relative to peers in OECD countries. In the U.S., insufficient support for balancing paid work and family responsibilities has been a limiting factor in further increases in women’s labor force participation. However, increases in workplace flexibility with the rise of hybrid or remote work following the pandemic may have boosted labor force participation, particularly for women with caregiving responsibilities. 

The report concludes with policy recommendations that could support a continued upward trajectory in the LFPR. In addition to policies that prioritize tight labor markets and support caregivers, policymakers should target reductions in incarceration rates and substantial improvements in the pay and working conditions of jobs of the future (like caregiving jobs) to attract and retain workers.  

“The past decade has shown us that tight labor markets are key to boosting prime-age labor participation rates. But policymakers can do much more to remove barriers that keep would-be workers on the sidelines,” said Elise Gould, senior economist at EPI and co-author of the report.