Abstract: We decompose the variance in black and white male labor force participation rates across US metropolitan areas in 1990 into three effects: that due to variation in labor force participation within labor force categories across metropolitan areas (local labor market effects); that due to variation in the distribution of those categories across metropolitan areas (demographic structure effects); and that due to the covariation between these two effects. Variation in labor force participation rates within demographic categories (local labor market effects) accounts for 56 percent of the variance in labor force participation rates across metropolitan areas for white men but over 75 percent for black men. Variation in the frequency of  membership in each demographic category is a relatively unimportant factor for both groups. The covariance between demographic effects and local effects is negligible for black men but accounts for twenty five percent of the intermetropolitan variance in white male participation rates.  This covariance is a measure of how well adjusted the demographic characteristics of local labor forces are to local economic conditions; our results indicate that this adjustment is greater for white men than black men. We also use this decomposition to identify the causes of variation in the difference between black and white labor force participation rates.  Black-white differences in response to local labor market effects conditions generates most of this variance.  These different local labor market effects are greatest among young single men with less than a high school education.