This paper presents a new way to look at
monthly changes in unemployment rates using CPS
data on the labor force. The percentage monthly
change in the unemployment rate is expressed as the
sum of three terms: (1) the amount due to growth in
the population, which must be offset by growth in
employment and nonparticipation if the unemployment
rate is not to increase; (2) the amount due to
changes in the size of the labor force; and (3) the
amount due to changes in employment.
Average values for these amounts are computed
for recession and non-recession months from Febru-
ary 1950 to December 1983. The results for teen-
agers are consistent with the "baby boom" hypothe-
sis about sources of trends in unemployment rates.
However, because of their highly unstable patterns
of employment and labor force participation, demo-
graphic forces on unemployment rates are weaker
for teenagers than for those 20 and older.