Prime Aged American Men | From over 80 percent at work to less than 3 in 4

The percentage of Prime Aged American Men Without Disability (PAAM) who are employed is one of the best labor market indicator.

Its main advantage is that it is not subject to the discouraged workers effect like the Unemployment Rate. This ‘discouraged worker effect’ come from the fact that a lot of unemployed stop searching for work after a while because they think that there is no job for them out there. Because they are discouraged, they are no more counted as jobless in the unemployment statistics because they stop searching for work.

So the Prime Aged American Men employment-population ratio, as it is called in the economic literature, is a good complement to the Unemployment Rate to judge the state of the labor market. And what it tells is a bleak picture.

Before the Great Recession, over 80%, 4 in 5 of all PAAM were working. These days, less than 75%, 3 in 4 are.