Nonfarm payrolls: watch the LFPR - Scotiabank

Analysts at Nomura explained that The labor force participation rate (LFPR) has stayed roughly flat over the past three years, and we expect that trend to continue into March. 

Key Quotes:

"We estimate that the LFPR would fall 0.2pp per year because of aging effects, which implies that LFPR has been increasing for certain groups to offset this aging-gravitational effect. One group that has received increased attention is working age (ages 25-54) men and women without a college degree. This group accounted for about half of the overall decline in the LFPR from December 2007 to March 2015.  

The financial crisis accelerated the decline in LFPR of this group. However, we estimate that its LFPR has moved up about 0.6pp since January 2015. This is still a far cry from the 3.7pp drop during the recession, but it does provide some ray of hope for this group and a possible reason for why the LFPR may not fall in the coming months."