Statistics released by the State of Maine for June 2023 reveal that although the state’s unemployment rate continues to decrease, labor force participation also remains low compared to the rest of the country.
For the month of June, unemployment in Maine was at 2.4 percent, representing a .5 percent decrease since January.
For reference, the national average unemployment rate for the month of June was 3.6 percent. Last month, Maine’s unemployment rate was the eighth lowest in the nation, tied with Montana and Utah.
Labor force participation in Maine, on the other hand, was at 58.4 percent in June. Although this is a .4 percent increase since January, Maine nonetheless had one of the lowest labor force participation rates in the country last month.
For comparison, the average workforce participation rate nationally in June was 62.6 percent.
The labor force participation rate represents the proportion of the population over the age of 16 that is actively working or looking for work at any a given time.
Although Maine may be understood to naturally have a lower labor force participation rate compared to other states as a result of being the “oldest state in the nation,” it is unclear whether this fact can fully explain the present phenomenon.
Since early-to-mid 2021, Maine’s labor force participation has been moving sharply in the opposite direction of the national average.
At a time when workforce participation has been increasing nationwide, participation in Maine’s labor force dropped dramatically. Although it has begun to rise slightly in recent months, Maine still remains remarkably distant from the rest of the country.
Furthermore, despite the fact that Maine, New Hampshire, and Vermont all have a similar median age, New Hampshire and Vermont have significantly higher rates of labor force participation – at 65.4 percent and 64.9 percent respectively.
The data suggest something beyond an aging population is contributing to Maine’s low rate of workforce participation, although currently available data does not clearly speak to a potential alternative cause.
2 Comments
The $64,000 question. How is it possible for both these statistics to be moving in the opposite direction? Of the population that allegedly can work, only 54.8% are working or looking? But apparently, of that 54.8%, barely 2.4% are not working yet but may be looking(?). That basically says that if more people did rejoin the workforce – the unemployment rate would go up.
Who are these non-participating slaggards who must not be paying taxes either? Don’t tell me that these folks got the $450 and $850 checks. I said don’t tell me!
The slaggards mentioned in the previous comment are our grandparents (retired). Labor force participation in Maine is lower than the nation because a higher share of the population is retirement age. In every age group (16 to 24, 25 to 34, 35 to 44, 45 to 54, 55 to 64, or 65+), labor force participation in Maine has been higher or has matched nation for many years. Our 80 year olds should not have to work. In addition to this long-term pattern, labor force participation rate estimates published by the federal Bureau of Labor Statistics for Maine have been too low in the last few years. The Maine Department of Labor’s Center for Workforce Research and Information published an article demonstrating that labor force estimates cannot be reconciled with the job growth that has occurred. Read about it at http://www.maine.gov/labor/cwri/blogs/divergingsurveys.pdf