Tuesday, June 21, 2016

The Council of Economic Advisoers on the Labor Force Participation Rate

 - by New Deal democrat

The White House's Council of Economic Advisors has put out a report on the decline in labor participation by prime age males.  Here's the link:


The prose is somewhat dense, but the report is well worth reading.  They generally dismiss increases in people collecting disability and household responsibilities as drivers, and focus on low wages and the burgeoning incarceration rate as drivers.

The importance of incarceration is a major contribution (generally, that men who have been incarcerated find it nearly impossible to get a decent job thereafter).  I'm not sure I buy into the remainder of the analysis.  For example, the increase in household responsibilities is found to be inconsistent with responses to the Time Use Survey.  But that is, in turn, inconsistent with what men are telling the Census Bureau in the monthly CLS. Why is one result from a different survey accepted over the result from the very same survey giving rise to the labor force participation rate itself?  The CEA doesn't explain.
Anyway, lots of grist of the mill.  Once I've taken a deeper look, I will probably post more in detail.