As most of my readers know (but I’ll remind you anyway!), I have two major themes on this blog which are:
- Slow U.S. Economic Growth, averaging just 2% per year since the end of the Great Recession in June 2009.
- Massive Debt Accumulation, now 75% (for the public debt, on which we pay interest) of GDP, the highest since right after the end of WWII.
My last post, “The Economy Is Improving But Not Enough” points out that even the latest very good news, that median household incomes were up by 5.2% in 2015, doesn’t get us back to where we were before the financial crisis hit.
A new book, “Men without Work,” by Nicholas Eberstadt sheds much light on why our economy is growing so slowly. Says Mr. Eberstadt:
- Between 1948 and 2015, the work rate for U.S. men age twenty and older fell from 85.8% to 68.2%. Even for prime working age men, age 25 – age 54, the work rate fell from 94.1% in 1948 to 84.3% in 2015.
- This translates into 9.5 million prime working age men who are not in the workforce, even after correcting for the million or so of these men who are in school or training.
- Statistically, men age 25 – 54 are more likely to be an un-worker in 2015 if 1) they had no more than a high school diploma, 2) were unmarried and without dependent children, 3) were not an immigrant and 4) were African American.
- Looking for possible explanations for so many unemployed men, it is noteworthy that the work rate for prime working age women has increased from 34% in 1948 to 70% in 2015.
- One reason for so many unemployed men is the high arrest rate and incarceration rate for working age men, especially blacks and those without a high school education. In fact, Incarceration rates are way up even though violent crime is declining.
Conclusion. It seems obvious that having such a large, and growing, number of prime working age men out of the work force is a very serious problem. Besides slowing down economic growth, they are losing their best opportunity for personal fulfillment. What should be done to turn around this deplorable situation? Stay tuned!