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July 1985, Vol. 108, No. 7

Measuring labor force flows:
a special conference examines the problems

Paul O. Flaim and Carma R. Hogue

Evidence accumulated in recent decades indicates that the American labor market is very dynamic, with millions of persons entering and leaving it each month. In addition, large flows are known to occur strictly within the labor force, as many workers move from employment to unemployment and vice versa. However, the volume of these flows—which are largely offsetting—cannot be determined from the data published monthly on the size of the labor force and its principal components. The statistics published monthly are "stock" measurements, which tell us only what "net" changes, if any, there have been in the levels of employment and unemployment, in the counts of persons outside the labor force, and the various components of each of these groups.

To determine how many persons are flowing back and forth among thee groups each month—regardless of what happens to the size of the groups—one must dig deeper and turn to special data on "gross" flows. Unfortunately, these data have proven difficult to analyze and explain and have been little used. As a result, we know little about the exact size of the gross monthly changes which lie behind the ups and downs in our widely used labor force statistics.

Although little used, statistics on gross labor force flows have been tabulated in considerable detail for decades. They have been derived from the same source—the Current Population Survey (CPS)—which provides the monthly "stock" measurements of the labor force and its principal components. These groups flow (or gross change) tabulations indicate, among other things, how many persons join the ranks of the jobless each month and what their status was the previous month (that is, employed or not in the labor force). Likewise, they also show how many persons leave the ranks of the unemployed each month and what their labor force status is the following month.

This excerpt is from an article published in the July 1985 issue of the Monthly Labor Review. The full text of the article is available in Adobe Acrobat's Portable Document Format (PDF). See How to view a PDF file for more information.

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