Steven A. Camarota is the director of research at the Center for Immigration Studies.
While the unemployment rate has improved significantly in recent years, the official unemployment rate only includes those who have looked for a job in the last four weeks. It does not include those of working-age who dropped out of the labor force entirely — neither working nor looking for work. (Figures do not include those in prison.) The labor force participation rate has not returned to pre-2007 recession levels, and relative to 2000 the rate looks even worse. Things are particularly bad for those without a college education, the core of Donald Trump’s support.
Among Native-Born Americans:
- The overall unemployment rate for natives in the third quarter of 2016 was 5.1 percent (6.8 million), a dramatic improvement over the peak in the third quarter of 2010 at 9.5 percent. However, the rate is still above the 4 percent in the same quarter in 2000 (unemployment figures are for those 16 and older).
- The overall unemployment rate obscures the low labor force participation rate, especially among those without a college education.
- There has been a long-term decline in the labor force participation rate of working-age (18 to 65) natives without a bachelor’s degree. Only 70.4 percent of natives in this group were in the labor force in the third quarter of this year; in 2007, before the recession, it was 74 percent, and in 2000 it was 75.9 percent.
- The labor force participation rate of natives without a college degree shows little meaningful improvement in the last four years. For example, in the third quarter of 2012 it was actually slightly better than it was in the third quarter of 2016.
- The decline in labor force participation among those without a bachelor’s degree is even more profound when it is measured relative to those who are more educated.
- In the third quarter of 2016, 70.4 percent of natives without a bachelor’s degree were in the labor force, compared to 84.7 percent with a bachelor’s degree — a 14.2 percentage-point difference. In the third quarter of 2007, the gap was 11.1 percentage points, and in the third quarter of 2000 the gap was 10.6 percentage points.
- Working-age immigrants without a college education also have not fared well since the recession. Unlike natives, immigrants without a college education did improve their labor force participation between 2000 and 2007. But it has not returned to 2007 levels. Also like natives, there has been no meaningful progress in the last few years.
- In the third quarter of 2016, the labor force participation rate of immigrants (18 to 65) without a bachelor’s degree was 71.2 percent, somewhat better than that of natives, but still well below their rate of 75.1 percent in the third quarter of 2007.
Immigrants and Natives Not in the Labor Force:
- In the third quarter of 2016, there were a total of 50.5 million immigrants and natives ages 18 to 65 not in the labor force, up from 43.4 million in 2007 and 37.9 million in 2000.
- Of the 50.5 million currently not in the labor force, 40.1 million (79.5 percent) did not have a bachelor’s degree.
- The above figures do not include the unemployed, who are considered to be part of the labor force because, although they are not working, they are looking for work. There were almost eight million unemployed immigrants and natives in the third quarter of this year; almost three-quarters of the unemployed are adults who do not have a bachelor’s degree.
Data and Methods
The two primary employment surveys collected by the U.S. government are referred to as the “household survey” (also called the Current Population Survey or CPS) and the “establishment survey” (also called the Current Employment Statistics Survey or CES). The establishment survey asks employers about the number of workers they have. In contrast, the CPS asks people at their place of residence if they are working. Both surveys are collected by the Census Bureau for the Bureau of Labor Statistics (BLS). While the two surveys show the same general trends, the figures from the two surveys differ to some extent.
Because it asks workers about their employment situation, only the CPS provides information about who is working, who is looking for work, and who is not working or looking for work. Moreover, only the CPS asks respondents about their socio-demographic characteristics such as education, age, and country of birth. Thus, only the CPS can be used to compare employment among immigrants and the native-born. (The establishment survey is not released to the public, so no independent analysis of it is possible.) For these reasons, this analysis uses the public-use files of the CPS to examine employment in the United States by quarter. For each quarter, the three CPS surveys combined include roughly 350,000 natives and 43,000 immigrants. The survey is weighted by the Census Bureau to reflect the actual size of the U.S. population.)
The data for the tables in this report comes from the public-use files of the July, August, and September CPSs for 2000 to 2016. The tables presented here are reported by quarter. Quarterly data are more statistically robust, especially for smaller populations like immigrants and minorities, due to the inclusion of three months of data. Persons in institutions like prisons or nursing homes are not included in the CPS. The CPS is the nation’s primary source for unemployment and other labor force statistics. Like all government surveys, the data are weighted to reflect the actual size and demographic makeup of the U.S. population.
The government publishes employment statistics that are both seasonally adjusted and unadjusted from the survey. The figures in this analysis are seasonally unadjusted. Unadjusted figures are computationally simpler and easier for other researchers to replicate. In general, BLS does not provide separate estimates for the foreign-born (immigrants) and the U.S.-born broken down by characteristics like education, race, and age. However, all CPS respondents are asked these questions. The Census Bureau defines the foreign-born as persons who are not U.S. citizens at birth, which includes naturalized citizens, legal immigrants who are not citizens (green card holders), temporary visitors and workers, and illegal immigrants. All figures for the total U.S. population in this report match seasonally unadjusted figures from the BLS.
Defining Labor Force Attachment
The Unemployed. The standard measure of unemployment, referred to as U-3, takes the number of people who report that they are not working and have looked for a job in the last four weeks and divides it by the number actually working plus those looking for work. The top halves of Tables 1, 3, and 5 report the number employed and the number unemployed for the third quarter of each year, 2000 to 2016. The left sides of Tables 7, 8, and 9 also report the U-3 unemployment rate in detail for different segments of the population in 2000, 2007, and 2016. We focus on 2007 and 2000 because they represent the peak years of the last two economic expansions.
The Labor Force. The labor force includes all those working or who have looked for work in the four weeks prior to the CPS. When looking at the number and share not in the labor force, it is very common to report statistics only for those under age 65 because the overwhelming majority of those over 65 do not work for reasons not related to economic conditions. The right sides of Tables 7, 8, and 9 report the number working in detail for different segments of the population in the third quarters of 2000, 2007, and 2016. The tables also report the share of people in the labor force, which is the inverse of those not in the labor force, as shown in Tables 1, 3, and 5. The right sides of Tables 7, 8, and 9 also report the employment rate. The employment rate is simply the share of people in each segment of the population who are working.