Results from Two Research Reports Suggest Reasons for, Solutions to State’s Low Participation Rate

Columbia, S.C. – The South Carolina Labor Force Participation Task Force (LFPTF) held its fifth meeting on December 9, 2022. The Task Force, which first convened on March 23, 2022, is comprised of various leaders from academia, research, and business who united to parse the available data and commission two multifaceted analyses of South Carolina’s labor market. The goal was to determine why our state has such a low rate of labor force participation; only 56.4 percent of eligible adults were working or looking for work as of November, the fourth lowest figure in the country, compared with 62.1 percent nationally.

The first project, conducted by Millan Chicago LLC, was a survey of individuals who had dropped out of unemployment insurance (UI) employment and wage records, administered by the S.C. Department of Employment and Workforce (DEW), during the pandemic. Specifically, these people appeared in the data in 2019, filed for UI benefits in 2020, and were not present in the data in 2021. The survey aimed to understand what happened to that population of over 150,000 people; specifically, the Task Force wanted to know how many of those people left the labor force, how many might be interested in returning, what barriers to employment they faced, and what might motivate them to rejoin the workforce in the state. More than 6,000 people ultimately responded to the survey.

“The survey was able to determine that 46 percent of respondents are working in some capacity, which makes sense since contractors and sole proprietors, among other types of work, aren’t included in our agency’s UI wage records,” said S.C. Department of Employment and Workforce (DEW) Labor Market Information Director and LFPTF member Dr. Bryan Grady. “Another 26 percent said they were not interested in work due to being retired, studying, caregiving, or having health-related issues. That left 28 percent of respondents who are not working but indicated that they could be. The survey results showed that the greatest barriers preventing individuals from rejoining the workforce are low-paying jobs, health and disability concerns, gaps in employment history, and lack of reliable transportation and childcare.”

A second project, conducted by Chmura Economics and Analytics, ran a broad-based analysis to identify the causes of our state’s low labor force participation rate. “One of the primary takeaways from their report was how central South Carolina’s aging population is to this issue,” said S.C. Department of Employment and Workforce Research Economist and LFPTF member Dr. Erica Von Nessen. “Between 1994 and 2019, the share of our state’s population age 65 or older nearly doubled. This fact alone explains most of the decline in South Carolina’s labor force participation rate in that time. However, the Chmura analysis also identified other causes from the academic literature and potential policy levers for bringing people into the labor force, such as ensuring that people with disabilities receive the accommodations they need to be gainfully employed.

Both projects were initiated by the Task Force, with the support and planning of DEW and the S.C. Council on Competitiveness.

“Our agency places a strong focus on reemployment in the state,” said DEW Executive Director Dan Ellzey. “While anyone can access SC Works Online Services to find jobs statewide that meet their specific needs, including pay requirements and remote work opportunities, SC Works centers across the state aid jobseekers with the barriers to work identified in this research. Professionals at these centers can help individuals network with employers, conduct skills assessments, assist with resume writing and interviews, and even support with childcare assistance or transportation. We cannot emphasize enough the importance of knowledge and accessibility when it comes to the job market. Help and resources for reemployment are available for those who need them the most, including individuals on the sidelines of the labor force.”

There will be public briefings in the first quarter of 2023 to share more details of the results. The dates of the meetings will be posted on the LFPTF Research and Information page, as the dates are finalized, and a media advisory will be sent a week in advance of these meetings.

For information regarding the Survey, past Task Force meetings, presentation slides, videos, and more, please visit the LFPTF Research and Information page. Full bios and headshots of the LFPTF members can be found at dew.sc.gov/taskforce. Members of the press can reach out to communications@dew.sc.gov for any inquiries or interview requests for DEW’s LMI Division.