(Bloomberg) -- Adriana Mousso, a 44-year-old mother of six, hasbeen looking for work she can take pride in since June. Giving upisn’t on her mind.

Related: Americans with disabilities faceemployment challenges

“I want to have something that makes me feel good, a job that’sgoing to contribute for my family,” Mousso said. She mostlyrecently worked selling insurance and is looking for a job thatdraws on her prior experience in manufacturing project management.“It’s just not an option to drop out.”

Related: 7 lessons American manufacturing's declinecan teach any company

An improved labor market is giving unemployed Americans hope andkeeping them in the job hunt, a change from recent years, when weakprospects forced many to drop out.

Employment seekers’ new-found staying power is one explanationfor a slight uptick in the labor force participation rate to 62.9percent, which is defying aging demographics and is on track forits first annual increase in a decade.

“It doesn’t benefit society at large, across a number ofdimensions, to have able-bodied, competent workers drop out of thelabor force,” said Michael Gapen, New York-based chief U.S.economist for Barclays Capital Inc. Signs of “labor forceattachment for somebody who has the skills to offer is a goodthing.”

Related: New overtime rule isn't a compliance'gotcha': DOL

The more it happens, “the more likely it is that that thelong-run performance of the economy will improve over time” asavailable labor is put to use, he said.

Though the unemployment rate has halved since 2009, thathappened as the workforce hemorrhaged job seekers and theparticipation rate sank to about a four-decade low, taking some ofthe shine off of the improvement.

Related: Employers offer cutting edge benefits tostay competitive

The fact that many potential American workers remain sidelinedhas become a political talking point. Republican presidentialcandidate Donald Trump has said America’s low unemployment rate isa hoax, implying the labor market is weaker than the datasuggests.

That said, the slide in the participation rate has more todo with aging than anything else: about 10,000 baby boomers reachthe retirement age of 65 each day, and older workers are lesslikely to work or look for jobs. Barclays calculates that since the2007-2009 recession, about 30 percent of the decrease is cyclicaland the rest is driven by demographics. The Labor Department willrelease the October figure in its monthly employment reportFriday.

The workforce is aging and “we are not going to be able to dodgethat,” said Ryan Sweet, a senior economist at Moody’s AnalyticsInc. in West Chester, Pennsylvania. “An increase in theparticipation rate would definitely be helpful, but any firming istemporary.”

What is causing the pickup for now, and how long-lived it maybe, is crucial to understanding how much slack is left in the labormarket, where the unemployment rate is headed, and what that meansfor wage growth, inflation and monetary policy.

Fed Satisfaction

Federal Reserve policy makers have expressed some satisfactionat the recent pickup in the participation rate, with Fed ViceChairman Stanley Fischer calling it a welcome development. InSeptember, Chair Janet Yellen cited this as one justification togive the economy room to run before raising rates.

Yellen said in September that the recent tick up inparticipation shows “a substantial number of people are beingattracted into the labor market.”

But a growing number of economists, including those at SocieteGenerale, Barclays and Goldman Sachs, have concluded that in thepast year, the major driver of the improvement in participation isfewer exits from the labor force rather than a jump inentrants.

Goldman Sachs estimates that the probability of a long-termunemployed person dropping out is 25 percent, down about 5percentage points from the end of 2015.

“The better labor market does not appear to be drawing workersback into the labor force just yet, but it seems to be causing thelong-term unemployed to continue active search,” Zach Pandl andDavid Mericle of Goldman Sachs said in a note.

Mousso, whose husband works as an engineering project manager,said she’d rather hold out for a job that fits her skills, butrealistically she wants to be employed by year-end.

“If I take a job, I want to kick butt at it,” said Mousso, wholives in Rochester, New York, “but also, I have a family to supportand the longer it takes me, it impacts my family.”

Fewer exits is a welcome outcome. But because it draws on alimited pool of people, it’s less likely to produce a sustainedincrease in the participation rate than if discouraged workers werereturning to the labor market in droves, said Barclays’ Gapen.

This may seem like a quibble, but it matters. Re-entrants implythere’s still more slack in the job market so “wages and inflationwon’t move higher as quickly as others would expect,” Gapen said.Conversely, if people hanging on in the labor force to findemployment are the predominant reason, as he believes, thendiminished slack will spark wage and inflation pressures that theFed would have to address.

For Sweet, of Moody’s, the two outcomes aren’t mutuallyexclusive. It may well be that fewer dropouts are the biggerdrivers right now, and as worker pay climbs, re-entrants may takethat spot.

“The tighter job market is making more people stay in the laborforce, and that’s step one,” Sweet said. For those outside thelabor force but who want a job “as wage growth accelerates, we’llpull more people back in. That’s step two. We need both these.”

More candidates are starting to approach ManpowerGroup Inc., aMilwaukee-based staffing company, asking for guidance on how toresume looking for a job.

“There is a huge percentage of the population that is capable ofworking that may not know where to start,” said Kip Wright, seniorvice president of Manpower North America.

Such workers will hopefully join the labor market recovery overtime. Meanwhile, rising participation is conducive to growth foryet another reason.

“It is a sign of improved confidence not only in the job marketbut also in the economy,” Sweet said. “If confidence continues tostrengthen, for consumers and businesses, this expansion has plentyof room to run.”

Copyright 2018 Bloomberg. All rightsreserved. This material may not be published, broadcast, rewritten,or redistributed.