Parsing the monthly jobs numbers is a lot harder than it looks. On the surface, the decline in the unemployment rate to 7.3 percent is good news — but as we've noted here before, a lot of that rate's decline is attributable to declining participation in the labor force. And figuring out what exactly is behind that is its own tough project. Some of it's that the population is aging, which reduces labor force participation for reasons unrelated to the economic downturn; some of it is that people are waiting to enter the labor force due to the poor job market; and some of it is that people who were once in the labor force are dropping out.
So it's good to check in with the employment-to-population ratio — which is exactly what it sounds like — as well as the unemployment numbers. Like the labor force participation rate, that ratio is sensitive to changes in the age composition of the population, and so can be expected to fall when the population is aging irrespective of changes in the economy. But you can get around that by looking at participation rates by age group. That provides a lot of clues as to how many middle-aged people are unemployed or dropped out of work, how many young people are delaying joining the workforce or have dropped out shortly after entering, and how many retirees are holding onto their jobs longer versus taking an early retirement:
These numbers aren't perfect. As Becky Pettit's sobering Invisible Men notes, the "population" in "employment-to-population ratio" is the "civilian noninstitutionalized population," a denominator that excludes the millions of (primarily black and Latino/a) incarcerated Americans and renders their condition invisible to policymakers and others using this data. But at the very least, it renders those not in the labor force less invisible than they are when we focus narrowly on the unemployment rate.
Update: Here's an interactive version of the above chart: