A Look at Oregon’s Labor Force Participation and Unemployment by Education LevelApril 13, 2017
Oregon’s economy has been in the news in recent months for recording some of its lowest unemployment rates since comparable records began in 1976. However when we look within Oregon’s labor force, unemployment rates can vary when looking at a number of demographic variables: be it age, race, gender, or educational attainment.
The Current Population Survey (CPS) is a monthly survey sponsored by the Bureau of Labor Statistics and conducted by the U.S. Census Bureau. The survey provides us with estimates of Oregon’s unemployment and labor force participation rates by education level for the population ages 25 and older.
Unemployment Rate by Education
People in Oregon’s labor force with a bachelor’s degree or higher level of education are consistently a group with lower unemployment rates compared with Oregonians with lower levels of education. On the flip side, people in Oregon’s labor force with less than a high school diploma consistently experience higher unemployment rates compared with groups with higher educational attainment.
For Oregonians in the labor force with some college or an associate degree, the group has a lower unemployment rate most of the time compared with Oregonians who have a high school diploma and no college, in particular during the recent recession. However, when the economy is adding employment and the overall unemployment rate is fairly low, the unemployment rate for Oregonians with a high school diploma and no college is pretty close to the unemployment rate for Oregonians with some college or an associate degree.
A second thing that can be observed in the unemployment chart is that the unemployment rate for Oregonians with lower levels of educational attainment is much more volatile than for those with higher educational attainment. Prior to the Great Recession, which began in late 2007, Oregonians with less than a high school diploma had an unemployment rate of 7 percent in 2007. At the height of the Great Recession in 2009, Oregonians with less than a high school diploma had an unemployment rate of 18 percent, an 11 percentage point increase over the two-year period.
Oregonians with a bachelor’s degree or higher level of education had an unemployment rate below 2 percent in 2007. In 2009 the unemployment rate for this group grew to nearly 6 percent. That was certainly a significant increase from the 2007 unemployment rate, but nothing like the mountain peak seen in unemployment among Oregonians with less than a high school diploma.
Labor Force Participation Rates by Education
The labor force participation rate (LFPR) is normally defined as the share of the civilian, noninstitutional population 16 years and over that is employed or unemployed. However, when looking at the labor force participation rate by educational attainment, we are only looking at the population 25 years and older.
Roughly three out of four Oregonians ages 25 and above with a bachelor’s degree or higher are labor force participants. At the other end of the spectrum, roughly half of Oregonians with less than a high school diploma participate in Oregon’s labor force.
Labor force participation rates show more volatility for those with lower levels of educational attainment. Prior to the recession, 55 percent of Oregonians with less than a high school diploma participated in the labor force in 2007. That participation rate dropped to 46 percent by 2012. As Oregon’s economy has grown and the labor market has improved in recent years, the participation rate for those with less than a high school diploma was back up to 55 percent in 2016.
In comparison, the labor force participation rate for Oregonians with a bachelor’s degree or higher level of education was 74 percent in both 2007 and 2012.
People with less than a high school diploma comprise less than 9 percent of the people (ages 25 and above) in Oregon’s labor force. Looking at the long-term trend for the other 91 percent of Oregon’s labor force, which includes everyone with high school diploma or higher level of education, Oregon’s labor force participation rate is declining over time. For those with a high school diploma and no college, the LFPR has dropped from 63 percent in 2003 to 58 percent in 2016. For those with some college or an associate degree the LFPR has declined from 72 percent in 2003 to 62 percent in 2016. Oregonians with a bachelor’s degree or higher level of education only saw a slight decline in the LFPR, dropping from 74 percent in 2003 to 73 percent in 2016.
To learn more about the reasons behind the long-term decline in Oregon’s labor force participation rate look at our report Oregon’s Falling Labor Force Participation: A Story of Baby Boomers, Youth, and The Great Recession. Not to give too much of the report away, but the aging of Oregon’s population and the retirement of baby boomers plays a large part in explaining Oregon’s declining labor force participation rate.