Unemployment rate inches up during 2023, labor force participation rises

In the fourth quarter of 2023, the unemployment rate averaged 3.8 percent, slightly higher than the rate of 3.6 percent in the fourth quarter of 2022.¹ The number of unemployed people was 6.3 million, up from 5.9 million at the end of 2022.² Most of this modest increase in unemployment occurred in the latter half of 2023.

Total employment, as measured by the Current Population Survey (CPS), rose over the year, although the employment­­­­–population ratio, at 60.3 percent in the fourth quarter of 2023, changed little (after removing the effects of annual adjustments to population controls introduced at the beginning of the year).³ The labor force participation rate (the percentage of the population age 16 and older who are either employed or actively seeking employment) rose to 62.6 percent. (See appendix A for more information about the CPS and the Current Employment Statistics survey. See appendix B for more information on the annual adjustments to CPS population controls.)

This article highlights a broad range of economic indicators from the CPS to provide a picture of labor market performance in 2023, both overall and for various demographic groups. This article provides 2023 updates on usual weekly earnings, labor force flows, and those not in the labor force. It summarizes recent changes in the employment situations of veterans, people with a disability, and the foreign born. This article also presents new data on people who teleworked or worked at home for pay.

Unemployment increased among men in 2023

In 2023, the overall number of unemployed people changed little through the second quarter, but this number edged higher in the third quarter and remained near this level for the remainder of the year. There were 6.3 million unemployed people in the fourth quarter of 2023, up from 5.9 million a year prior. The unemployment rate showed little movement through the second quarter of 2023 but then rose slightly; the unemployment rate averaged 3.8 percent in the fourth quarter. This was up by 0.2 percentage point from the fourth quarter 2022 average of 3.6 percent. (See chart 1.)

The modest increase in unemployment in 2023 was concentrated among men. The number of unemployed men rose by about 400,000 (to 3.6 million) from the fourth quarter of 2022 to the fourth quarter of 2023, and their unemployment rate increased by 0.4 percentage point to 4.0 percent. In contrast, the number of unemployed women held relatively steady in 2023. At around 2.8 million in the fourth quarter, the number of unemployed women was little different from a year earlier; their jobless rate was also little changed over the year at 3.5 percent. (See table 1.)

Unemployment rate for Black people hovered near its record low during 2023

The jobless rate for Black people was little changed over the year at 5.6 percent in the fourth quarter of 2023 and remained near the historic low of 5.4 percent (for the quarterly series), but Black people continued to have the highest unemployment rate among the major race and ethnicity groups.⁴ By comparison, the unemployment rate for Asians edged up over the year to 3.2 percent in the fourth quarter of 2023. The jobless rates for Whites and Hispanics both rose over the year to 3.4 percent and 4.8 percent, respectively.⁵ (See chart 2.)

Jobless rate of prime-working-age women near prepandemic low

The unemployment rate for people 16 to 24 years old changed little in 2023. Within this age group, the pattern differed for teenagers and young adults. The jobless rate for teenagers (those ages 16 to 19) edged up from 10.8 percent in the fourth quarter of 2022 to 12.1 percent in the fourth quarter of 2023. The jobless rate for young adults (those ages 20 to 24), which tends to be much lower than that for teenagers, also fluctuated during the year; it measured 6.7 percent in the fourth quarter, which was little changed from the rate recorded at the end of 2022. (See table 2.)

Overall, the unemployment rate for people of prime working age (those ages 25 to 54) changed little over the year, at 3.2 percent in the fourth quarter of 2023. However, the pattern varied by sex, as the unemployment rate for men of prime working age increased by 0.4 percentage point to 3.4 percent, while the rate for prime-working-age women was little changed over the year, at 3.0 percent.

The unemployment rate for workers age 55 and older was 2.8 percent in the fourth quarter of 2023, an increase of 0.3 percentage point from a year earlier. The jobless rate for men in this age group (3.0 percent) increased over the year, while the rate for women age 55 and older (2.7 percent) was little changed.

Unemployment rate edged up for people with less than a high school diploma

Among workers age 25 and older, jobless rates tend to be higher for people with less education, and this pattern continued in 2023. The jobless rate for people with less than a high school diploma—which in recent years has been two to three times higher than the rate for those with a college degree—edged up to 6.1 percent in the fourth quarter of 2023 (the rate was 5.2 percent at the end of 2022). (See table 3.)

Unemployment rates were little changed over the year for high school graduates with no college (4.1 percent), those with some college or an associate’s degree (3.0 percent), and people with a bachelor’s degree and higher (2.1 percent). (See chart 3.)

The number of people unemployed 5 to 26 weeks increased in 2023

The number of short-term unemployed people (those who were jobless for less than 5 weeks) was little changed over the year at 2.2 million in the fourth quarter of 2023. This group accounted for 34.2 percent of unemployed individuals, down from 37.6 percent in the fourth quarter of 2022. The number of long-term unemployed people (those who were jobless for 27 weeks or longer) was also little changed over the year at 1.3 million; the long-term unemployed accounted for 19.7 percent of all unemployed individuals in the fourth quarter of 2023. This percentage was little different from 20.1 percent in the fourth quarter of 2022. (See table 4.)

The increase in the number of unemployed people in the latter half of 2023 was reflected in the number of people unemployed 5 to 14 weeks and 15 to 26 weeks. Those unemployed 5 to 14 weeks rose by 192,000 over the year (to 1.9 million), while those unemployed 15 to 26 weeks increased by 244,000 (to 1.0 million). The share of those unemployed 15 to 26 weeks increased to 16.3 percent by the end of 2023, up from 13.5 percent in the fourth quarter of 2022. (See chart 4.) In the fourth quarter of 2023, the median duration of unemployment was 9.1 weeks, an increase from the figure of 8.2 weeks recorded at the end of 2022. The average (mean) duration of unemployment in the fourth quarter of 2023 was 21.1 weeks, little different from a year prior.

Number of job losers increased over the year

Unemployed people are grouped by their reason for unemployment. The first group, job losers and people who completed temporary jobs, consists of people who completed a temporary job, were on temporary layoff, or permanently lost their job. The second group, job leavers, voluntarily left their job. The third group, reentrants, reentered the labor force after a period of labor market inactivity. The fourth group, new entrants, consists of people who entered the labor force for the first time.

The increase in unemployment in 2023 was concentrated among job losers and people who completed temporary jobs. The number of people in this group rose to 3.1 million in the fourth quarter of 2023, up from the average of 2.7 million in the fourth quarter of 2022. (See table 4.) These individuals accounted for nearly one-half of the unemployed at the end of 2023. Within this group, the number of permanent job losers rose by 269,000 over the year to 1.6 million. The number of unemployed people on temporary layoff edged up over the year to 903,000 in the fourth quarter of 2023. (See table 4 and chart 5.)

The number of reentrants to the labor force was essentially unchanged over the year at 1.8 million in the fourth quarter of 2023; reentrants accounted for 28.5 percent of the unemployed. The number of new entrants to the labor force edged up over the year to 598,000 in the fourth quarter, and new entrants comprised 9.5 percent of the unemployed.

The number of unemployed job leavers—people who voluntarily left their jobs—changed little over the year; there was an average of 818,000 people in this group in the fourth quarter of 2023. Job leavers accounted for 13.0 percent of unemployed people at the end of 2023.

Unemployment rates for most major occupational groups showed little or no change from 2022 to 2023

The jobless rate was unchanged from 2022 to 2023 for people who had worked in the large category of management, professional, and related occupations; the rate averaged 2.0 percent in both years. (Data are annual averages.) The unemployment rates also showed little or no change for sales and office occupations (3.6 percent in 2023); natural resources, construction, and maintenance occupations (4.4 percent); and production, transportation, and material moving occupations (4.9 percent).

From 2022 to 2023, the unemployment rate for people who had worked in service occupations before becoming unemployed declined by 0.3 percentage point to 4.5 percent. Among service occupations, the lowest unemployment rates were in protective service occupations (2.9 percent) and in healthcare support occupations (3.5 percent). (See table 5.)

All six alternative measures of labor underutilization increased over the year

The U.S. Bureau of Labor Statistics (BLS) uses CPS data to construct six alternative measures of labor underutilization.⁶ These measures are known as U-1 through U-6 (U-3 is the official unemployment rate). Each measure provides different insights into the labor resources that are being underutilized, but they tend to show similar cyclical patterns. (See the box note that follows for more information about the six measures of labor underutilization.)

Each of the six alternative measures of labor underutilization increased from the fourth quarter of 2022 to the fourth quarter of 2023. Alternative measures U-1 through U-5 each saw an increase of 0.2 percentage point. By the fourth quarter of 2023, U-1 rose to 1.4 percent; U-2 rose to 1.8 percent; U-3 rose to 3.8 percent; U-4 rose to 4.0 percent; and U-5 rose to 4.6 percent. U-6 saw the largest increase over the year, 0.5 percentage point, to 7.1 percent. (See chart 6.)

Percentage of people remaining unemployed trended up over the year

A great deal of underlying movement contributes to the relatively small over-the-month net changes that typically occur in the different labor force statuses. These gross movements are captured by data on labor force flows, which show that millions of people move between employment and unemployment each month, while millions of others leave or enter the labor force.⁷ In 2023, 15.6 million people, 5.8 percent of the population, changed their labor force status in an average month. Examining the current status (employed, unemployed, or not in the labor force) of people who were unemployed in the previous month provides another perspective on the modest changes in the unemployment picture for 2023.

Historically, unemployed people have been more likely to remain unemployed from one month to the next than to either find employment or to leave the labor force. The likelihood of unemployed people remaining unemployed trended up over the year; this outcome provides further support for some cooling of the labor market in 2023. In December 2023, the share of unemployed people who remained unemployed was just under half, at 48.9 percent (calculated as a 3-month moving average). This was 3.3 percentage points higher than its value of 45.6 percent at the end of 2022. In December 2023, 27.7 percent of people who were unemployed a month earlier found work, while 23.4 percent stopped looking for work and left the labor force. These measures were 29.1 percent and 25.2 percent, respectively, a year earlier. (See chart 7.)

Number of people not in the labor force changed little in 2023

People who are neither employed nor unemployed are classified as not in the labor force; that is, these individuals are not currently working and have not looked for work in the 4 weeks preceding the survey.⁸ In the fourth quarter of 2023, the number of people who were not in the labor force, at 100.1 million, changed little (on net) over the year. The majority of people who are not in the labor force do not want a job, although a small percentage (5.5 percent in the fourth quarter of 2023) of this group do want a job but had not sought employment in the 4 weeks preceding the survey.⁹ The number of people who wanted a job was essentially unchanged from a year earlier. (See table 6.)

People who are not in the labor force are considered marginally attached to the labor force if they wanted a job, were available for work, and had looked for work sometime in the prior 12 months (but not in the 4 weeks before the survey). In the fourth quarter of 2023, 1.5 million people were marginally attached to the labor force, little different from a year earlier. (See chart 8.)

A subset of the marginally attached are discouraged workers—people not currently looking for work because they are discouraged over their job prospects. In the fourth quarter of 2023, there were 397,000 discouraged workers; this number was essentially unchanged from the same quarter of 2022.

Labor force participation rate increases in 2023, reflecting continued labor market improvement among women

The labor force participation rate increased in 2023 (after accounting for population controls) to 62.6 percent in the fourth quarter. The labor force participation rate for women increased by 0.7 percentage point over the year to 57.3 percent in the fourth quarter. The labor force participation rate for men, at 68.2 percent, changed little over the year. (See table 1.)

The number of employed people rose to 161.4 million in the fourth quarter of 2023. The employment–population ratio (the percentage of the population age 16 and older who are employed), at 60.3 percent in the fourth quarter, was little changed over the year (after accounting for population controls). The employment–population ratio for women increased to 55.3 percent over the year, while the ratio for men decreased to 65.5 percent in the fourth quarter of 2023 (after accounting for population controls). (See table 1 and chart 9.)

Labor force participation of Black people and Hispanics increased in 2023

In 2023, the labor force participation rates for Black people (63.3 percent in the fourth quarter of 2023) and Hispanics (66.9 percent) edged up over the year (after taking population controls into account), while the rates for Whites (62.2 percent) and Asians (64.7 percent) were little changed. The employment–population ratio for Black people (59.8 percent in the fourth quarter of 2023) edged up over the year (after taking population control effects into account). The employment-population ratios for Whites (60.1 percent), Asians (62.6 percent), and Hispanics (63.7 percent) showed little change from the fourth quarter of 2022. (See table 1.)

The increase in labor force participation was concentrated among people of prime working age

The labor force participation rate for prime-working-age people (those ages 25 to 54) increased by 0.8 percentage point in 2023; this rate averaged 83.3 percent in the fourth quarter. Both women and men contributed to this increase. Prime-working-age women’s participation reached a historic high of 77.6 percent in the second quarter of 2023 before ending the year at 77.4 percent.¹⁰ Men in this age group participated in the labor force at a rate of 89.2 percent in the fourth quarter of 2023, an increase of 0.6 percentage point from a year earlier.¹¹ (See table 2.)

Among older workers, those age 55 and older, the labor force participation rate was little changed over the year; this rate averaged 38.6 percent in the fourth quarter of 2023. The share of the population that is age 55 and older is growing, and older individuals tend to participate in the labor force at much lower rates than younger people. This is evident among detailed age breakouts of older workers; the labor force participation rate was 66.3 percent for those ages 55 to 64 in the fourth quarter of 2023, much higher than the figure of 19.4 percent for those age 65 and older. (Data for people ages 55 to 64 and age 65 and older are not seasonally adjusted.)

The labor force participation rate for younger workers, those ages 16 to 24, changed little in 2023 (after accounting for population controls); this rate averaged 56.4 percent in the fourth quarter. In an ongoing pattern, young adults (ages 20 to 24) participated in the labor force at almost double the rate of teenagers (ages 16 to 19), at 71.2 percent and 37.5 percent, respectively, in the fourth quarter of 2023.

Employment increased for people of prime working age

Employment for prime-working-age people, those ages 25 to 54, increased in 2023. The employment–population ratio for this group increased by 0.7 percentage point over the year to 80.6 percent in the fourth quarter. Among women of prime working age, the employment–population ratio reached an all-time high of 75.3 percent in the third quarter of 2023, and it finished the year at 75.1 percent.¹² However, prime-working-age men continued to be employed at higher rates than women. The employment–population ratio for prime-working-age men was 86.1 percent in the fourth quarter; this ratio changed little over the year. (See table 2.)

Employment for younger workers, those ages 16 to 24, changed little in 2023 (after accounting for population controls). The employment–population ratio was little changed both for people ages 16 to 19 and for 20- to 24-year-olds. The employment–population ratio for people ages 16 to 24, 51.8 percent in the fourth quarter of 2023, was little changed over the year. (See table 2.)

The number of employed people age 55 and older was little changed in 2023. The employment–population ratio for older workers was 37.5 percent in the fourth quarter, little different from a year earlier. (See table 2.) Within this age group, men’s employment–population ratio declined, while the ratio for women was little changed. The employment patterns for this broad age group mask some differences among older workers. For example, the employment–population ratio for those ages 55 to 64 continued to trend up in 2023; this ratio reached a record-high of 64.6 percent in the fourth quarter of 2023 (not seasonally adjusted).¹³ In contrast, the ratio for people age 65 and older, at 18.8 percent in the final quarter of 2023 (not seasonally adjusted), showed little change over the year and remained below the prepandemic rate.

Employment–population ratios improved for those with lower levels of education

For people age 25 and older, employment among those with less than a high school diploma, at 8.8 million, edged up from the fourth quarter of 2022 to the fourth quarter of 2023, while the employment–population ratio for this group increased to 45.0 percent in the fourth quarter of 2023. This is the highest quarterly ratio since the series began in 1992. The employment–population ratio for high school graduates with no college, 54.8 percent in the fourth quarter of 2023, also was up from a year earlier. The employment–population ratios for those with some college or an associate’s degree (60.4 percent in the fourth quarter of 2023) and those with a bachelor’s degree and higher (71.1 percent) were little changed on net over the year. (See table 3.)

Employment grew in management, professional, and related occupations

From 2022 to 2023, employment in the broad category of management, professional, and related occupations increased to 70.3 million. (Data are annual averages.) This occupational group employed about 44 percent of the total workforce and accounted for about 80 percent of total employment growth over this period. There was also substantial employment growth in service occupations from 2022 to 2023; the number of people employed in this sector rose to a level of 26.2 million. (See table 7.)

Employment was little changed from 2022 to 2023 in sales and office occupations (30.3 million in 2023); production, transportation, and material moving occupations (20.0 million); and natural resources, construction, and maintenance occupations (14.3 million).

Number of self-employed workers changed little in 2023

The total number of nonagricultural unincorporated self-employed workers was 9.1 million in the fourth quarter of 2023; this number was essentially unchanged from the year prior.¹⁴ (See table 8.)

The unincorporated self-employed accounted for 5.7 percent of nonagricultural workers in the fourth quarter of 2023; this is similar to the rate of 5.8 percent at the end of 2022. (See chart 10.)

Number of involuntary part-time workers increased somewhat in 2023

People who work part time for economic reasons, often referred to as involuntary part-time workers, work less than 35 hours per week but would have preferred full-time employment. These individuals work a reduced number of hours because of unfavorable business conditions (slack work) or their inability to find full-time work. The number of involuntary part-time workers averaged 4.2 million in the fourth quarter of 2023, an increase from 3.8 million a year earlier.¹⁵ Much of this increase occurred among those reporting slack work as the reason for working a part-time schedule. Even with the modest increase in this type of underemployment, the number of involuntary part-time workers in 2023 was similar to the level reached in 2019 before the onset of the COVID-19 pandemic. (See chart 11.)

The unemployment rate for veterans held steady over the year

There were 17.8 million veterans age 18 years and older in the fourth quarter of 2023. (Data are not seasonally adjusted.) Veterans who served during World War II, the Korean War, and the Vietnam-era account for the largest share of the veteran population, at 5.8 million. The next largest shares of wartime-period veterans are those who served during Gulf War-era II (5.1 million) and Gulf War-era I (2.9 million). About 3.9 million veterans served on active duty during other service periods, mainly between the Korean War and the Vietnam-era and between the Vietnam-era and Gulf War-era I. Among veterans, women accounted for 11.5 percent of the total veteran population in the fourth quarter of 2023.¹⁶

The unemployment rate for veterans was unchanged over the year at 2.8 percent; this was lower than the rate for nonveterans (3.5 percent) in the fourth quarter of 2023. The jobless rates for veterans of each service period changed little over the year. In the fourth quarter of 2023, the unemployment rates for veterans were as follows: 3.5 percent for Gulf War-era II veterans (those who served from September 2001 to the present); 2.3 percent for Gulf War-era I veterans; and 2.4 percent for World War II, Korean, and Vietnam-era veterans. (See table 9.)

The labor force participation rate for veterans (48.6 percent) changed little over the year. Labor force participation rates are generally lower for older veterans who have served in earlier wars than they are for those who have served in the more recent Gulf War-era II period. The labor force participation rate for those who served during World War II, the Korean War, and the Vietnam-era (who are all over the age of 65) fell over the year to 13.3 percent in the fourth quarter of 2023. By contrast, Gulf War-era II veterans, who tend to be younger, had a much higher participation rate of 79.4 percent. This figure was little changed from a year earlier.

Unemployment rate rose among people with a disability

In the fourth quarter of 2023, the unemployment rate for people with a disability was 7.1 percent, an increase of 1.0 percentage point from a year earlier. (Data are not seasonally adjusted.) In contrast, the jobless rate of people with no disability edged up by 0.2 percentage point over the year to 3.4 percent. The unemployment rate of people with a disability remained about twice as high as the rate for those with no disability. (See table 10.)

The labor force participation rate of people with a disability (24.5 percent in the fourth quarter) edged up over the year, while their employment–population ratio (22.8 percent) was little changed. Among those with no disability, the labor force participation rate increased to 68.0 percent, while the employment–population ratio was little changed at 65.7 percent in the fourth quarter (after accounting for population controls). The lower participation and employment–population rates for people with a disability reflect, in part, the older age profile of those with a disability; older people, regardless of disability status, are less likely to be in the labor force.

The labor force participation rate for native-born workers increased in 2023, particularly among women

The foreign born accounted for 18.8 percent of the U.S. civilian labor force age 16 years and older in the fourth quarter of 2023. (Data are not seasonally adjusted.) The labor force participation rate for foreign-born workers showed little change in 2023, while the participation rate for native-born workers increased over the year. However, foreign-born workers continued to have a higher labor force participation rate (66.2 percent) than native-born workers (61.7 percent).¹⁷ Among the native born, there were strong gains in labor force participation and employment among women. (See table 11.)

The employment–population ratio for foreign-born workers (63.8 percent) changed little over the year. The employment–population ratio for native-born workers (59.6 percent in the fourth quarter of 2023) edged up over the year (after taking population controls into account).

The unemployment rate for foreign-born people, at 3.7 percent in the fourth quarter of 2023, increased by 0.5 percentage point over the year, while the jobless rate for native-born people was little changed over the year at 3.5 percent.

Median weekly earnings of full-time wage and salary workers increased, outpacing inflation

Median weekly earnings for full-time wage and salary workers were $1,117 in 2023, up 5.5 percent from 2022.¹⁸ (Data are annual averages.) During the same period, the Consumer Price Index for All Urban Consumers (CPI-U) measured inflation at 4.1 percent. Real median usual weekly earnings (adjusted with the use of the CPI-U) rose 1.4 percent from 2022 to 2023.¹⁹ (See table 12.)

Women’s median weekly earnings were $1,005 in 2023; this was 83.6 percent of men’s median weekly earnings ($1,202). In 1979, the first year for which comparable data on usual weekly earnings are available, women’s earnings were 62.3 percent of men’s earnings. (See chart 12.)

By age group, median weekly earnings were highest for men ages 35 to 64. Median weekly earnings were $1,364 for men ages 35 to 44, $1,396 for men ages 45 to 54, and $1,380 for men ages 55 to 64. Women’s median weekly earnings were also highest for workers ages 35 to 64. Median weekly earnings were $1,136 for women ages 35 to 44, $1,115 for women ages 45 to 54, and $1,065 for women ages 55 to 64. Men and women ages 16 to 24 had the lowest median weekly earnings, $736 and $691, respectively. Men's and women's earnings were closer among younger workers than older workers. For example, women ages 16 to 24 earned 93.9 percent as much as men in the same age group, while the women's-to-men's earnings ratio was 77.2 percent for those ages 55 to 64. (See chart 13.)

Among the major race and ethnicity groups, median weekly earnings increased for all groups. From 2022 to 2023, earnings increased (in current dollars) by 6.2 percent for Hispanics (to $874), 5.2 percent for Asians (to $1,474), 4.9 percent for Whites (to $1,138), and 4.8 percent for Black people (to $920). (See table 12.) The women’s-to-men’s earnings ratio varied by race and ethnicity; the ratio was higher among Black people and Hispanics. For example, Black women earned 91.6 percent as much as Black men; Hispanic women earned 87.4 percent as much as Hispanic men; White women earned 83.3 percent as much as White men; and Asian women earned 79.4 percent as much as Asian men.

Among workers age 25 years and older, those with a high school diploma but no college had the largest over-the-year percentage increase in median weekly earnings in comparison with other educational attainment groups. Earnings for workers who were high school graduates with no college ($899) rose by 5.4 percent from 2022 to 2023. However, earnings continue to be positively correlated with educational attainment. Workers with a bachelor’s degree or higher had median weekly earnings of $1,609 in 2023, more than double the median weekly earnings of $708 for workers with less than a high school diploma. (See table 12.)

Among the major occupational groups, people employed full time in management, professional, and related occupations had the highest median weekly earnings in 2023: $1,778 for men and $1,349 for women. As has historically been the case, men ($801) and women ($676) employed in service occupations earned the least among the major occupational groups in 2023. (See table 13.)

Telework rate increased in 2023

In the fourth quarter of 2023, 32.5 million people teleworked at least some of the time, up from 28.4 million people in the fourth quarter of 2022.²⁰ (Data are not seasonally adjusted.) The telework rate (the number of people who teleworked or worked at home for pay as a percentage of people who were working) rose over the year, from 18.5 percent to 20.7 percent in the fourth quarter of 2023. Women were more likely to telework than men (22.8 percent versus 18.9 percent in the fourth quarter of 2023). Telework rates increased for both women and men in 2023. (See table 14.)

Among those who teleworked in the fourth quarter of 2023, 49.3 percent teleworked for all of their work hours and 50.7 percent teleworked for some of their hours. This was a change from a year earlier, when about 54 percent of all people who teleworked did so for all of their work hours. (See table 15.)

Not surprisingly, the telework rate varies by occupation. Of the five major occupational groups, management, professional, and related occupations had the highest telework rate at 35.1 percent in the fourth quarter of 2023. Within this group, 64.2 percent of people working in computer and mathematical occupations teleworked at least some of their work hours; this was the highest telework rate of any detailed occupational group. People working in sales and office occupations had a telework rate of 22.2 percent, also higher than the overall rate across all occupations. (See table 14.)

The other major occupational groups had much lower telework rates in the fourth quarter of 2023: service occupations, at 4.1 percent; production, transportation, and material moving occupations, at 2.4 percent; and natural resources, construction, and maintenance occupations, at 2.3 percent. (See table 14.) In 2023, telework rates tended to increase by the greatest amount for occupations that already had a high incidence of telework.

Telework rates also differ substantially by educational attainment. Among people with a bachelor’s degree or higher, 37.3 percent teleworked or worked at home for pay in the fourth quarter of 2023, much higher than the telework rate of 2.6 percent for workers with less than a high school diploma. Over the year, the telework rate increased for people with higher levels of education but was little changed for people with less than a high school diploma. (See table 14.)

Summary

In 2023, the labor market remained strong. The national unemployment rate increased slightly over the year, to 3.8 percent in the fourth quarter, but remained low by historical standards. The increase in unemployment was concentrated among men. The labor force expanded, and total employment grew. There was an increase in the labor force participation rate but little change in the employment–population ratio. Much of the labor market improvement in 2023 occurred among prime-working-age people (those ages 25 to 54). Median usual weekly earnings increased to $1,117 in 2023; this was 5.5 percent higher than in 2022 and outpaced inflation, which grew at 4.1 percent over the same period as measured by the Consumer Price Index. New telework data indicate that 20.7 percent of workers teleworked in the fourth quarter of 2023, up from 18.5 percent a year earlier.

Appendix A: The CPS and the CES

BLS produces two monthly employment series obtained from two different surveys: an estimate of total nonfarm jobs, derived from the Current Employment Statistics (CES) survey, also called the establishment or payroll survey; and an estimate of total civilian employment, derived from the Current Population Survey (CPS), also called the household survey. The two surveys use different definitions of employment, as well as different survey and estimation methods. The CES survey is a survey of employers that provides a measure of the number of payroll jobs in nonfarm industries. The CPS is a survey of households that provides a measure of employed people age 16 years and older in the civilian noninstitutional population.

Employment estimates from the CPS provide information about workers in both the agricultural and nonagricultural sectors and in all types of work arrangements: workers with wage and salary jobs (including employment in a private household), workers who are self-employed, and workers doing unpaid work for at least 15 hours per week in a business or farm operated by a family member. CES payroll employment estimates are restricted to nonagricultural wage and salary jobs and exclude private household workers. As a result, employment estimates from the CPS are higher than those from the CES survey. In the CPS, however, workers who hold multiple jobs (referred to as “multiple jobholders”) are counted only once, regardless of how many jobs these workers held during the survey reference period. By contrast, because the CES survey counts the number of jobs rather than the number of people, each nonfarm job is counted separately, even when two or more jobs are held by the same person.

The reference periods for the surveys also differ. In the CPS, the reference period is generally the calendar week that includes the 12th day of the month. In the CES survey, employers report the number of workers on their payrolls for the pay period that includes the 12th of the month. Because pay periods vary in length among employers and may be longer than 1 week, the CES employment estimates can reflect longer reference periods.

For more information on the two monthly employment measures, see “Comparing employment from the BLS household and payroll surveys,” Labor Force Statistics from the Current Population Survey (U.S. Bureau of Labor Statistics, last modified February 2, 2024), https://www.bls.gov/web/empsit/ces_cps_trends.htm.

Appendix B: Adjustments to population estimates for the CPS

Updated population controls for the CPS are introduced annually with the publication of January data in The Employment Situation news release. The change in population reflected in the estimates introduced in January 2023 is based on a blended 2020 population base, which combines population totals from the 2020 census and demographic characteristics from other sources. The January 2023 adjustments reflected updated birth and death statistics; new estimates of net international migration, which reflected increased international migration; and methodological improvements. Consequently, data for 2023 are not strictly comparable to those for earlier years. The analysis presented in this article takes the effects of these population controls into account.

The adjustment increased the estimated size of the civilian noninstitutional population in December 2022 by 954,000, the civilian labor force by 871,000, employment by 810,000, and unemployment by 60,000. Although the adjustment did not affect the total unemployment rate, the labor force participation rate and the employment–population ratio each increased by 0.1 percentage point. The population control adjustments were concentrated among youth ages 20 to 24. In this age group, these adjustments increased the civilian labor force by 844,000, employment by 788,000, and unemployment by 56,000.

For additional information on the population adjustments and their effect on national labor force estimates, see “Adjustments to household survey population estimates in January 2023” (U.S. Bureau of Labor Statistics, February 2023), https://www.bls.gov/cps/population-control-adjustments-2023.pdf.