The % of 25-54 year-olds employed was 80.9% in Jan. after being 80.7% in Dec.; Average hours worked increase

One weakness of the unemployment rate is that if people drop out of the labor force they cannot be counted as an unemployed person and the unemployment rate goes down. They are no longer actively seeking work and it might be because they are discouraged workers. The lower unemployment rate can be misleading in this case. People dropping out of the labor force might indicate a weak labor market.

We could look at the employment to population ratio instead, since that includes those not in the labor force. But that includes everyone over 16 and that means that senior citizens are in the group but many of them have retired. The more that retire, the lower this ratio would be and that might be misleading. It would not necessarily mean the labor market is weak.

But we have this ratio for people age 25-54 (which also eliminates many college age people who might not be looking for work).

It was 80.6% in Jan. 2020 and 69.6% in April 2020.  Click here to see the BLS data. Here is what it was for each of the last 4 years

2022) 79.883% 

2023) 80.683%

2024) 80.717%

2025) 80.600% (just an 11 month average due to no data for October instead of 12)

 

This is only the 6th month since April 2001 when the % of 25-54 year-olds employed was as high as 80.9%.

 

The 12 month average for Feb. 2025 to Jan. 2026 was 80.6028%. For the previous 12 month average for Feb. 2024 to Jan. 2025 it was 80.725% (I used 80.65% for Oct. of 2025 when the government was shutdown-that was the average of Sep. & Nov.). Any time this 12 month average has fallen it has overlapped a recession. See my post from Feb. 5, 2026 Can the percentage of 25-54 year-olds employed tell us anything about recessions? (Part 2) And is the current decline going to be the first without a recession?.

The unemployment rate was 4.3% in Jan. after being 4.4% in Dec. Click here to go to that data. Here is what it was for each of the last 4 years. 

2022) 3.6%

2023) 3.6%

2024) 4.0%

2025) 4.3%

 

Labor Force participation rose to 62.507% from 62.404%. Here is what it was for each of the last 4 years 

 

2022) 62.2%

2023) 62.6%

2024) 62.6%

2025) 62.4%

 

The % of the adult population employed rose to 59.67% from 59.63% (that is people 16 years old and older).  Here is what it was for each of the last 4 years 

 

2022) 60.0%

2023) 60.3%

2024) 60.1%

2025) 59.7%  

Here is the timeline graph of the percentage of 25-54 year olds employed since 2015.

 

Now since 1948.

 

Now hours worked. This comes from the St. Louis FED. See Average Weekly Hours of All Employees, Total Private. It was 34.3 in Dec. and 34.4 in Jan. Shaded areas indicate U.S. recessions.  

  

Related posts: 

Now hours worked. This comes from the St. Louis FED. See Average Weekly Hours of All Employees, Total Private. It was 34.4 in Jan. and 34.3 in Dec. Shaded areas indicate U.S. recessions. 

This one has to do with the difference between two employment surveys. See The economy added 339,000 jobs in May according to the establishment survey but the household survey showed a loss of 310,000 and a rise in the unemployment rate from 2023. 

"The reason for the discrepancy is that there are two surveys. The establishment survey is used for the Labor Department's monthly jobs report. They contact businesses for this survey. The household survey is used to put together the unemployment rate. The Bureau of Labor Statistics contacts households for this one."

See also Comparing employment from the BLS household and payroll surveys from the BLS.

Click here to see a good Twitter thread on the jobs report (including wages) from Harvard economist Jason Furman.

See Here are the five key takeaways from the January jobs report by Jeff Cox of CNBC.