From a summary of his research:
Obama’s Council of Economic Advisers (CEA) makes the argument that the decline in prime-age male labor is a demand-side issue that ought to be addressed through stimulative infrastructure spending, subsidized jobs, wage insurance, and generous safety-net programs. If the CEA is mistaken, however, then these expensive policies may be ineffective or even counterproductive.
The CEA is mistaken—the evidence suggests there has been no significant drop in demand, but rather a change in the labor supply driven by declining interest in work relative to other options.
- There are several problems with the assumptions and measurements that the CEA uses to build its case for a demand-side explanation for the rise in inactive prime-age men.
- In spite of conventional wisdom, the prospect for high-wage work for prime-age men has not declined much over time, and may even have improved.
- Measures of discouraged workers, nonworkers marginally attached to the workforce, part-time workers who wish to work full-time, and prime-age men who have lost their job involuntarily have not risen over time.
- The health status of prime-age men has not declined over time.
- More Social Security Disability Insurance claims are being filed for difficult-to-assess conditions than previously.
Most inactive men live in households where someone receives government benefits that help to lessen the cost of inactivity.
Perhaps the CEA was doing normative sociology.
In other words, incentives matter. You create incentives not to work, more people do not work. I have 2 things that come to mind. First, efforts to help poor always create these problems, as they are based on income. So the lower ones income, the more benefits. Discourages work, but also marriage, as generally household income is key (which are thinks that the government should not discourage). Not sure there is a good way around this problem. Second point, facts are political. There are a whole range of issues where the “answer” depends on your politics, as there is always a “study” to support your point of view. Think minimum wage, fracking, climate change causing hurricanes , as well as many other issues.
“…the prospect for high-wage work for prime-age men has not declined much over time…”
Perhaps it hasn’t really, but those jobs are not uniformly dispersed throughout the country as in times past. The geographic dispersion aspect of this should be the real focus. Kling has mentioned this a few times recently.
My dad made something like $80,000 when he retired with really good medical benefits. That was above average because he had seniority, but still gives you an idea what a union job paid. 10+ hour days and waking up at 3am, but not bad.
They busted the union when he retired. Not because the business was unprofitable, they were making money. But because Hispanic scabs were more prevalent and they were bought by a Mexican company with the capital to wait out a strike. Now the same job pays $40k with no benefits. If that had been the case when I was growing up I would have died because we didn’t have insurance for medical bills.
I’m aware there are still a few very difficult blue collar jobs that pay well, but there is no denying there just isn’t any scale to it all. If all these men did decide to work on and oil rig inn North Dakota the wage premium would disappear fast.
This just doesn’t jive with anything I’ve seen.
Don’t sweat it, this has nothing to do with unions. In Germany practically all blue collar automotive jobs are unionized and here the difference in compensation between today and 40 years ago is the same as you describe. I think the halving is more likely due to a doubling of the work force (women) and thus overabundance of labor. Maybe also the devaluation of money and the increase in prices.
Ctrl-F for “migr” and
What is this, “breadwinner premium”?
Whoa, that’s pretty crazy. I mean, it’s almost like Winship is saying (like Baumeister) that most men like leisure; don’t care to work; crave the feelings of social status, respect, and personal authority; and want reliable access to sex. Some even want to be married with children.
But they will work, instead of entertaining themselves, if that’s the only way to survive. And even when material survival is otherwise guaranteed, they will still work hard, if that’s a reliable way to attract and keep a mate who will stick with them, and look up to them. But women tend on average to be more attracted and loyal to those of higher social status and income, and are likely to marry and stick it out when marriage means a definite rise in ones material conditions vs. any alternative.
But if most women are economically independent – and especially if they are also educated and have jobs – they won’t be attracted to or care to marry a large number of lower-SES men, who will not be able to obtain what they want even if they do work hard.
So those men will just completely drop out of the bourgeois life-script, give up trying to impress, and try to sate their desires as best they can with alternative sources of pleasure, and many companies (and criminals) will do a thriving commerce catering to the demand and providing such alternatives. Many of those women will go on to have and raise children, but without much attachment to the sperm donors, and those children will grow up in fairly chaotic and disorganized familial circumstances, learning from example and of course internalizing an understanding of the same incentive structure.
Now, whether or not you find such a state of affairs desirable or not is a matter of opinion. I guess, though, I should point out that no one really seems to be celebrating these trends and this state of affairs. But regardless, they shouldn’t be any kind of mystery to anyone who can see reality clearly without being blinded by modern pieties.
What we see here is that the incentive structure for male work has been undermined by following forces of late modernity in developed countries (among others, this isn’t an exhaustive list.)
1. Secularization: reduces the religious motivation to conform ones behaviors to the bourgeois life script and general self-denying propriety.
2. Welfare: For females it decreases the “breadwinner premium” and allows the state to substitute for a husband in many ways, and for males is makes it possible to get by without regular work. Note: a universal basic income will obviously only exacerbate this force.
3. Vice Markets: These make leisure more attractive and enjoyable (in a way) for a men, and there are practically no meaningful limits on ones ability to overindulge. Video games, the internet, social media, streaming movies, pornography, cheap and hyper-hedonic junk foods, alcohol and drugs, etc.
4. Immigration: Especially when it is mostly male and low-skilled and competing precisely in the niches in which natives would be employed simply cannot do other than lower relative wages and status.
5. Female Emancipation, to include:
5.a. The Divorce Law Revolution: Makes the prospect of marital dissolution quick, easy, financially feasible, and much more attractive in general for women.
5.b. Sexual Revolution (+Vice Market matching, e.g., Tinder): Makes sex much easier to get for many men who would otherwise be pressured into earning more and/or marriage.
5.c. Female Education and Income Equality (+the de facto results of modern anti-discrimination policies): Makes women more independent and eliminated the reliable structural status gap between any class of men and the same class of women.
These were all “policy choices” in a sense. There is nothing inevitable about them for any government determined to push things in the other direction.
If one considers all or most of these to be “social progress”, then the various social pathologies which now characterizing the bottom half of Murray’s Coming Apart population, to include the “mysterious” labor force dropout of certain males, are the wages of that progress.
If one opposes any of those forces then one is some kind of radical, usually a reactionary radical. And I must point out that most contemporary libertarians support all of them, which maybe some disagreement regarding welfare, but often not even that (e.g., the Niskanen Center or Bleeding Heart crowds.)
This is what I part of what I mean by the need for an Alt-Libertarianism. A Libertarianism in which it is ok to recognize the sort of consequences I’ve described above, express misgivings about them, and tolerate policies that take these problems into account.
There was indeed a “breadwinner premium” in the 1960s. Assume three individuals performing exactly the same work with comparable skills — assembly language programmers with one year of experience in an insurance company for example. One is a married man with a pregnant wife being paid a salary of $5500 One is a single man being paid $4800. One is a single woman, who gets $4000.
In 1965, when maybe one beginning programmer in ten was female, this seemed eminently fair to all the mangers and guys in personnel departments who set salaries. In the early 1970s, when the numbers were more like one in four or one in three, men started to notice that women weren’t quite so pleased by this arrangement. And eventually, nasty government began handling out rules — it wasn’t legal to pay dark skinned people less than white skinned people doing the same work, and also it wasn’t legal to pay unmarried women less than married men doing the same work. Astonishingly, the Republic survived.
◾The health status of prime-age men has not declined over time.
◾More Social Security Disability Insurance claims are being filed for difficult-to-assess conditions than previously.
Are these statements both true? The only way it seems possible to me is if there is a steadily rising number of fraudulent SSDI claims. Surely this would have become aware to some branch of government by now.