A hot US job market is coaxing people in from the sidelines

WASHINGTON — A surprisingly strong burst of job growth over the past year has led many economists to wonder: Where are all the workers coming from?

As recently as last spring, analysts had worried that hiring would slow as the pool of unemployed shrank. Many employers have complained for years that they could no longer find enough people to fill their open jobs.

Turns out they were both wrong.

The pace of hiring in 2018 was the most robust in three years, and for a surprising reason: Many more people have decided to look for work than experts had expected. The influx of those job seekers, if sustained, could help extend an economic expansion that is already the second-longest on record.

The growth in America’s workforce — made up of people either working or looking for work — has helped reverse an alarming consequence of the recession: The exit of millions of Americans from the job market.

For five years after the Great Recession ended in 2009, many Americans gave up on their job hunts. Some suffered from disabilities. Others enrolled in school or stayed home to raise children. Still others were stymied by criminal pasts or failed drug tests. Some just felt discouraged by their job prospects. Because they weren’t actively seeking work, they weren’t even counted as unemployed.

Economists had speculated that millions of these people lacked necessary qualifications or were otherwise deemed undesirable by employers and might not work again. They were thought to be, in economic parlance, “structurally” unemployed. Subsequent hiring wouldn’t necessarily help them.

Yet for the past few years it has. The proportion of Americans ages 25 to 54 who have a job has reached nearly 80 percent — the same as before the recession. Economists refer to this age group as “prime-age” workers. It excludes older Americans who have retired and younger workers who may be in school.

“The U.S. is a very diverse and dynamic economy and can often surprise us,” said Julia Coronado, chief economist at MacroPolicy Perspectives. “This is a positive surprise. We’re due for one.”

Research released Thursday by Stephanie Aaronson, an economist at the Brookings Institution, and three other economists found that racial minorities and people with less than a college degree tend to benefit most from strong job growth when the unemployment rate is already low.

That it took nearly a decade for the proportion of prime-age Americans who have jobs to reach its pre-recession level shows just how ruinous the Great Recession was. It destroyed 8.7 million jobs. And the recovery that followed was comparatively sluggish.