Economic theory - Labor Force Projections

According to the human capital theory, the amount of money invested in labor for training and education results in a larger return or income. According to the notion, there is a direct relationship between educational investments and salary. Yet, because the labor market is volatile, calculating future wages is difficult. In truth, some people have high-paying positions that do not match their level of training and education.

The labor force participation rate is the number of people aged 16 to 64 who are seeking for work or are already working. It is calculated as the ratio of labor force to the total number of the working population.

Reasons for the decline of in labor force participation of youths

As years progress, many youths have access to better education and training which increases their expectation of high-paying job in the labor market. In fact, many people aged between 16 and 24 years are reluctant to look for work after completing their studies and instead opt to advance their education to get a better returns or income thus leading to the reduction of labor participation in the country. The accumulation of wealth has resulted in families who are well off. Therefore, the youths from these homes are not in a hurry to look for jobs because their parents meet their financial obligations. Old employees are taking a long time to retire thereby reducing the vacancies that can be filled by young workers. Between 2012 and 2022, the increase in population will increase the labor force, however, the labor force participation is likely to reduce from 63.7% to 61.6% between the ranges above (Bureau of Labor Statistics).

Biblical insights

According to scriptures, those who do not work should not eat (2 Thessalonians 3:10). Jesus gave the parable of the ox that fell in a well on Sabbath in the form of a rhetorical question for the disciples to deliberate. I learned that work is important and as a young person, I should ensure that I am doing productive activities.

References

Bureau of Labor Statistics. “Labor force projections to 2022: the labor force participation rate continues to fall.” December 2013. Bureau of Labor Statistics. Document. 22 September 2017. .