Abstract
Because of the softening of the New England economy in the past 2 years, the availability of labor has become a less pressing issue for businesses in the region. However, projections of slower growth in the working-age population in the 1990s, attributable to changes in the age structure, present the possibility of tight labor markets and difficulties in finding suitable workers in the future. Focusing on the fraction of the working-age population that chooses to work, called the participation rate, pooled cross-section time-series regressions are used to examine the variation in regional participation rates over the period 1974-1988. In 1988, New England had the 2nd highest participation rates of any region for both men and women. It is found that, while participation rates tend to respond positively to favorable economic conditions, regional variations in participation rates have been remarkably persistent and are unlikely to be eliminated by the normal workings of the economy.