Sunday, February 8, 2015

Why Aren’t More Americans Working?

Ask a conservative this question.

Well, really, why bother. You know what the answer will be: everyone is lazy and claiming disability.

Or not. That’s the funny thing when you look actually look at data. It tells you things you might not hear otherwise.

What is incontestable is that labor force participation is way down over the last decade. This means there are more people who just aren’t interested in working. Who are those people?

It turns out, it’s mostly retirees and students (with the disabled trailing behind).

Here’s the story on retirees:

The panel on the left indicates that total retirees has risen, while the panel on the right indicates that early retirees has fallen. Put bluntly, this means that old people are living longer, choosing not to work when doing that (and who can blame them). That will decrease labor force participation, but I’d hardly call it a bad thing.

Then there’s students. Here’s their story:

Note that while students and the disabled are both up, that students actually opened a big lead after the Great Recession (that’s closed down now that it’s easier to get a job).

How is this all possible? It turns out that labor force participation, when measured by households, is down most sharply in the rich ones. The poor are actually more likely to be working now than they were before the Great Recession.

Think about this: it means that both political parties are full of it. Democrats would have you believe that the poor aren’t working as much as they’d like because the economy is weak. Except they’re working more. The Republicans would have you believe that people are faking disability to avoid work, when maybe all they’re faking is paying attention in class.

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