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December 11 2017

Women Aren't Alone in Making Strides in Employment

by Charlotte Hays

Patrice already has called attention to the strides made by women in last week's jobs report for November. As she noted, one more million women were working last November than in November 2016.

But an interesting article in Investors Business Daily says that women aren't the only group to see improvements in their employment picture. IBD writes:

But the most interesting part of the jobs report, which goes almost unnoticed by the media, is that it's not just a few groups seeing more jobs and opportunity — it's broad-based, with minorities, women, men and even those with low incomes, showing the best gains.

For instance, every education group — ranging from those with no high school diploma, to those with a bachelor's degree or higher — saw significant declines in unemployment in November 2017 from November 2016. And the biggest drops were for those with the least education, not the most.

Meanwhile, groups that have lagged in recent years also show major improvements. For instance, the jobless rate for African Americans dropped from 8% to 7.3%, while for Hispanics it fell from 5.7% to 4.7%. For Asians it stayed at an ultralow 3%.

Among adult men 20 years and over, unemployment has plunged from 4.3% last year to just 3.7% now. Likewise, adult female unemployment declined from 4.2% to 3.7%.

Not every group benefited, however:

Only one group is doing notably worse: Teenagers. Those aged 16 to 19 have seen their jobless rate rise from 15.2% to 15.9% in the past year. It's no fluke: Hefty minimum wage hikes around the country have slashed youth employment.

This runs counter to the liberal meme that the Trump economy is only for the rich.

Most of the November jobs report was good news. But in a piece that came out in the Wall Street Journal, also on Friday, but hours before the jobs report, Edward Lazear, chairman of the President's Council of Economic Advisers from 2006-2009 and now a Stanford business professor, wrote that, whatever the top numbers, there would be about two million jobs missing because of people on disability or others who have simply opted for idleness.

Why are fewer people in the 25 to 54 age segment of the population, people who would typically be in the most important time of their working lives, not working? Lazear writes:

A prime suspect is the increased number of people declaring that they are disabled. The correlation is almost perfect between unemployment and new applications for payments from government-provided disability insurance. When the unemployment rate rises, the number of applications for disability rises correspondingly. As unemployment falls, disability applications do too.

But this drop in new applications when the economy recovers does not necessarily bring down the number who receive disability benefits. Recipients often stay on the rolls even when market conditions improve because their skills depreciate and re-entering the workforce becomes increasingly difficult. As a consequence, the number of people on disability has risen from a bit more than seven million in 2007 to almost nine million now. Normal growth associated with a larger population may account for a share of that, but about three-quarters of the increase, 1.5 million, represent missing jobs.

Are these new disability recipients cheaters? The statistics here don’t imply that, but they do suggest that people respond to incentives. When the economy is strong, people work through their disabilities. When the economy weakens, people rationally decide to accommodate their disabilities, rather than continuing to work or to seek low-paying jobs.

This does not, however, explain the entire problem. Among young men, whose employment is low by historical standards, disability is not a major factor. Evidence suggests that many young men are opting to spend their time at home in leisure activities, perhaps because their job opportunities are poor. That reflects a lack of skills suitable for a modern economy.

Many analysts, along with President Trump, have argued for increased vocational training, which brings to mind blue-collar professions in manufacturing and the trades. This is too narrow a view. American schools could provide people who don’t go on to college with skills that are more useful in a modern service economy, instead of the watered-down and impractical academic curriculum currently offered. Better skills-based training would raise worker productivity and wages, reducing the incentive to go on disability or to choose leisure over work.

Work is not only an economic necessity for most of us--it provides shape and meaning to many aspects of our lives.

A society in which a large segment of the population has just decided to stay outside the workforce is in trouble ( as are the individuals who deprive themselves of the benefits of work, economic or otherwise).

We need to talk more about the dignity of work whether that work requires a college degree or not.

 

Independent Women's Forum is an educational 501(c)(3) dedicated to developing and advancing policies that aren’t just well intended, but actually enhance people’s freedom, choices, and opportunities. IWF is the sister organization of the Independent Women’s Voice.​
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