The next time an economist on television predicts the outcome of one policy or another with absolute confidence — “ . . . 1.7 percent nominal output parity growth per capita yada yada yada . . . ” — consider this: For the past 10 years, that economist, and everyone else in the profession, watched as the number of Americans participating in the workforce dropped year by year. And they have no idea why.
Those same economists have plenty of data and plenty of theories. Suspected culprits range from the stagnant economy to aging baby boomers. But every theory has its weaknesses. Among men, for example, the drop in labor-market participation began 50 years ago and continued unabated despite the economic booms of the 1980s and ’90s. During the past decade alone, even participation during the prime working years (ages 25 to 54) dropped from 84 to 81 percent.