Wednesday, August 31, 2016

16%

This Friday, a new jobs report will come out. If the Wall Street consensus is correct, it will show the unemployment rate continuing to hover around 5% while nonfarm payrolls will grow about 180,000 for the month. There are a lot of different positions on unemployment but a new book out has a very disturbing take.
Nicholas Eberstadt, a fellow at the American Enterprise Institute, argues in a new book called Men Without Work, due out next week, that we're suffering not from full employment, but massive underemployment. In particular, nearly one out of six working-age men have no job and are no longer looking for one. A release for his book calls this "a hidden time bomb with far-reaching economic, social and political consequences." We have 10 million fewer male workers in the labor force than we should have. Eberstadt in 2013 warned that our reliance on the standard unemployment rate "seriously disguises and understates the magnitude of the ongoing jobs crisis."

Some of Eberstadt's observations:
--Men age 25 to 54 now have a lower labor participation rate than they did in 1940, as the Great Depression was winding down. It is also far lower than in 1948, the year millions of men from World War II were flooding the labor market.
--One in six men today have no job and most have given up looking. At current trends, one in five will be out of the labor force in a generation.
--African-American men are twice as likely to be in this condition as either whites or Latinos.
--Many of these nonworking men support themselves by government disability benefits
--Surveys show an alarming increase among men age 25 to 54, the prime working years, engaged in doing such things as "socializing, relaxing and leisure," "attending gambling establishments," "tobacco and drug use," "listening to the radio" and "arts and crafts as a hobby." Many men, it seems, have virtually no work skills at all — and no way to get them.
Many of these trends in the collapse of male work may be a result of our soaring prison population and the "prevalence of non-institutionalized felons and ex-prisoners," Eberstadt argues.

It is unlikely that any real change will result from these observations because, again, so much is debatable. But one thing is not: Bad things happen in cultures where young men do not work.

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