The Mystery of the Missing Workers, Explained

The U.S. economy is in the midst of an historic comeback. But it’s happening with the lowest rate of labor force participation in more than four decades and a record number of unfilled jobs. It leaves economists, policymakers, and investors wondering: Where have all the workers gone?

At the height of the pandemic more than 23 million Americans were unemployed. Since then about half of those have found work, but the labor market remains almost 7 million jobs short of where it was before the initial lockdowns. Friday’s jobs report is expected to show that the U.S. added about 875,000 in July, the largest gain since August of last year. But that won’t do much to budge the labor force participation rate—a measure of the share of working-age Americans who are employed or looking for work—which has been stuck near its lowest level since the 1970s for almost a year.