Oregon Labor Force Participation Rates by County, 2017

by Tracy Morrissette

November 8, 2018

Oregon’s labor force participation rate – the percentage of the civilian noninstitutional population that is either employed or unemployed – peaked in 1998 at 69.0 percent and has since generally declined. The labor force participation rate (LFPR) fell to 61.2 percent in 2013 and 2014, the lowest annual percentage since comparable records began in 1976. Oregon’s LFPR remained very close to the 2013 and 2014 series low in 2015, before climbing to 63.2 percent in 2017.
Declining Labor Force Participation Is Not Unique to Oregon

The trend in Oregon’s LFPR resembles the overall trend for the United States, which peaked in the late 1990s and has since fallen near historically low levels.

One of the main reasons for falling participation since the late nineties is changing age demographics. People 16 to 24 years of age are delaying entry into the labor force to a greater extent than in the past due to increased participation in school-related activities, lowering labor force participation rates for this age group and by extension the overall LFPR. People aged 65 years and over – an age group most likely to be out of the labor force due to retirement – make up a larger share of the civilian noninstitutional population today than they did in the late nineties, as the oldest members of the baby boom generation began to reach this age category in 2012. LFPRs for people age 65 years and over are much lower than those for the prime working age group – people age 25 to 54 years. Therefore, as the baby boom generation continues to age into the 65 years and over population group, overall LFPRs will experience downward pressure as a larger share of the population reach an age group with an LFPR that is historically lower than those for other age categories.

In addition to changing age demographics, other factors, including the overall business cycle, have impacted LFPRs over time. The Oregon Employment Department published a special report on the labor force in June 2014 exploring these trends for the state in more detail. The analysis in this report covered data through 2013. More information and background on the trends in Oregon’s labor force can be found in this report.

Oregon Labor Force Participation Varies by County

Labor force participation rates for Oregon’s counties in 2017 ranged from a high in Hood River County of 78.7 percent to a low in Curry County of 45.6 percent.

Generally, counties located in the Northern part of Oregon, and especially in the Columbia River Gorge, generally had higher LFPRs in 2017. Counties located along the coast, and in the Southern and Eastern parts of Oregon generally had lower LFPRs.
Why Do Labor Force Participation Rates Vary by County?

Although several factors can influence the overall LFPR level in each county, there are some general tendencies in the data among counties that have higher or lower LFPRs than the state average. State level data show that LFPRs vary by race, ethnicity, gender and age. As population shifts and demographic groups comprise of a larger or smaller share of a county’s total population, these changes impact the overall LFPR. In addition, demographic groups can change their labor force participation over time, and across counties. As county LFPR data by demographic group comparable to the county LFPRs presented in this article are not available, this section will focus on the share of the total population that demographic groups comprise in each county. In addition to the influence of demographics on a county’s LFPR, economic factors will be considered later in this section.
One factor associated with a county’s LFPR is the age composition of the population in that county. LFPRs vary by age group. People age 65 years and over have the lowest LFPRs of all age groups (18.5% in Oregon for 2017), as many individuals in this category are retired. Generally, Oregon counties that have a higher percentage of the population age 65 years and over tend to have lower labor force participation rates. The counties with the lowest LFPRs in Oregon have higher percentages of the population that are age 65 years and over relative to other counties in Oregon – Curry County (33.2%), Josephine County (25.4%), and Coos County (25.3%). On the other hand, the counties with the highest LFPRs all have low percentages of the population that are age 65 years and over – Hood River County (15.2%), Washington County (12.9%), and Multnomah County (13.0%).

Those in the age range of 16 to 24 years have a lower LFPR than the overall average; 3.0 percentage points lower than the statewide average in Oregon in 2017. The counties in Oregon with the highest percentage of the population between the ages of 15 to 24 in 2017 – Benton County (25.8%), Polk County (16.5%), Lane County (16.0%), and Union County (15.2%) – are each home to a sizable university relative to the overall county population. As the presence of a university boosts an area’s population in this age range, the result is downward pressure on the LFPR since this age group tends to participate less in the labor force due to school attendance and related activities. The counties mentioned above all have LFPRs that were lower than the statewide average in 2017.

The LFPR for Hispanic or Latino ethnicity for Oregon in 2017 was 73.3 percent, compared with 66.1 percent for Hispanic or Latino ethnicity nationally and nearly 10.0 percentage points higher than the overall Oregon average. Part of the reason for the higher LFPR is that the Hispanic or Latino ethnicity population is younger (median age of 25.6 years in Oregon in 2017) than the overall population (median age of 39.3 years). Many of the counties in Oregon with higher LFPRs tend to have a larger share of the population that is Hispanic or Latino ethnicity (of any race) relative to the statewide average. Four of the five counties with the highest LFPRs in Oregon had Hispanic or Latino ethnicity populations greater than the statewide average of 13.1 percent in 2017 – Morrow County (36.2%), Hood River County (31.3%), Washington County (16.8%), and Yamhill County (16.0%).

The LFPR for men in Oregon in 2017 was 68.8 percent and the LFPR for women was 58.5 percent. However, population shares by gender don’t show significant correlations with county LFPRs in Oregon, as each county in Oregon has a near 50-50 split in gender groups.

Overall labor market conditions – the availability of jobs and the unemployment rate – also show some correlation with a county’s LFPR. In terms of just a simple mapping of the county LFPRs and unemployment rates, counties with high unemployment rates tend to have lower LFPRs and counties with low unemployment rates tend to have higher LFPRs. The counties with the lowest unemployment rates in Oregon in 2017 were Benton County (3.3%), Washington County (3.5%), Multnomah County (3.6%), Hood River County (3.6%), and Clackamas County (3.7%). Three of these counties – Hood River, Washington, and Multnomah – had the highest LFPRs in the state in 2017.

Looking at annual changes, counties that had a larger percentage change in the number of jobs added between 2016 and 2017 also tend to have had larger annual changes in their LFPR relative to other counties. The counties with the largest percentage increases in jobs in 2017 were Wheeler County (10.9%), Columbia County (4.6%), Hood River County (4.5%), and Deschutes County (4.1%). Wheeler County also had the largest annual increase in LFPR among counties in 2017 at 5.3 percentage points, Hood River County had the fourth largest increase in LFPR at 1.6 percentage points, and Columbia and Deschutes were tied for the sixth largest increase in LFPR at 0.8 percentage points each.

Conclusion

A county’s LFPR is determined by a combination of factors, and it is not always easy to definitively identify “one factor” as the reason a county’s LFPR is high or low from all the other factors. Further, as multiple factors are at play, one factor associated with higher LFPRs may be offset by another factor associated with a lower LFPR. An example of such offsetting factors in the above analysis was Benton County, a county with a low unemployment rate and a large percentage of the population age 15 to 24 years – the end result being Benton County’s LFPR was near the statewide average in 2017. With caution in mind that correlations are not perfect, general patterns do emerge among the counties with higher and lower LFPRs than the statewide average. For example, Hood River County, with the highest LFPR in Oregon in 2017 at 78.7 percent, is consistently near the top of the lists of county rankings in factors associated with a high LFPR. At the other end of the spectrum, Curry County – with the lowest LFPR in Oregon in 2017 at 45.6 percent – had the second largest percentage of population age 65 years and over and the fourth highest unemployment rate among Oregon’s counties at 6.1 percent.

Technical Note

The source of the U.S. LFPR is the Bureau of Labor Statistics (BLS). The source of Oregon’s LFPR is the Local Area Unemployment Statistics (LAUS) program, a joint effort between the BLS and the Oregon Employment Department (OED). The source of county LFPR data is OED. The source of the population data by county is the U.S. Census Bureau, Population Division.

 


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