Workforce is foundational to the vitality and growth of the Monadnock Region’s businesses, communities and institutions. While not a complete picture of a region’s workforce, labor force participation rates can provide a look into trends in the current and future size of the workforce at the local level. Utilizing American Community Survey Five-Year estimates, the graph below shows the percentage of the population over 16 participating in the civilian labor market from 2010 to 2019 across a number of geographies including neighboring counties and the State of New Hampshire.
Trends in labor force participation rate from 2010 to 2019 sends a striking message: across the United States, the share of the population over 16 participating in the labor force is shrinking. In Southwest, NH, that share is shrinking even faster. While this decrease in the labor force participation can be attributed to a variety of factors, the U.S. Census Bureau has found that the most prominent factor driving decreases in labor participation rates is an aging population. One might reasonably conclude, then, that the declining labor participation rate in Southwest NH is in no small part due to its aging workforce.
In an environment where many sectors of the economy report significant recruitment and retention challenges, trends in labor force participation signals a competitive disadvantage for Southwest NH. As the limitations on workforce become more severe as the nation ages, local efforts to promote in-migration of working age households and to utilize our existing workforce to its greatest potential will become more important than ever to ensure a healthy and vibrant economy.
It should be noted that the graph above reflects long-term trends in labor force participation rates that predate the coronavirus pandemic. More recent trends warrant further exploration, but evidence to date indicates that the pandemic has accelerated declining participation rates. On top of demographic headwinds, the pandemic introduced or exacerbated other challenges, such as a childcare shortages, employee burnout in certain sectors, and individuals choosing not to work due to health-related concerns.