In what could become an ideological paradox for Donald Trump, according to the ECRI, the president would have no choice but to allow a substantial number of immigrants into the US if he wishes to reach his goal of adding 25 million jobs over the next 8 years as his administration has promised.
As the ECRI calculates without a dramatic surge in immigration – or the number of women joining the labor force – it will be virtually impossible to add 25 million jobs in the next eight years - one of the bedrock economic growth promises of the Trump administration. This is because a key measure of economic health, the number of people participating in the work force (LFPR), that showed positive trends in the 20th century, has been going in the wrong direction largely because fewer women are participating.
The vast majority of baby boomers attained adulthood in the 28 years between the end of President Truman’s last term and the end of President Carter’s term, when male and female populations both grew at about 1.7% per year, on average. But in the next 20 years, until the beginning of the 21st century, the male population grew at only three-quarters of that pace and the female population grew at only two-thirds of that pace. In the 21st century, population growth slowed a bit further (not shown). The point that many appreciate is that overall population growth is well below what it used to be through the waning years of the Carter administration.
But drilling down to gender-related data shows a much more troubling story. Following the end of World War II, almost seven-eighths of the over-16 male population and nearly one-third of the over-16 female population were in the labor force (see chart). However, the LFPR for men has fallen continuously ever since, with the decline speeding up between the mid-1950s and the mid-1960s, then slowing somewhat until the eve of the Great Recession, around which time it took another step down, ending up at 69%.
In sharp contrast, the LFPR for women kept rising throughout the second half of the 20th century, converging quickly with the male LFPR, and rising rapidly between the mid-1970s and early 1980s — essentially the Carter years and early Reagan years. The pace of increase in the LFPR for women slowed in the 1980s and 1990s, and then peaked just above 60% around the end of the 20th century.
In effect, this convergence between the LFPRs for men and women, which was a critical feature of the 20th century job market, ended in the late 1990s. Only in the wake of the Great Recession did the two LFPRs come a bit closer, but that was just because the men’s participation rate fell even faster than women’s.
Furthermore, with the rising role of technological replacement and obsolescence of unskilled and semi-skilled menial laborers, the natural rate of job creation could be even slower.
As a result, with both the participation rate continuing to decline, to a big extent due to population demograhics, as well as due to a slowdown in the natural growth rate of the organic US population, Trump may have no choice but to open the floodgates to foreigners if he hopes to hit his 25 million bogey.