The labor force participation rate for 16-24 year olds is low because a lot of them are in school and has dropped as a higher % go to college.
OK yeah I note now that you did say :
And I said âget rid ofâ which is not equivalent.
It might be a challenge to reform benefits to help that specific guys situation.
Iâm not sure how youâd go about it other than having a special class of disability / aid category to cover ârandom periodic temporary disabilityâ.
Or maybe theres other better ways to fix the system to help that guys situation that Iâm just not thinking of.
Part of the problem is that its hard to have a nation wide system that works well for everyone and also doesnât leave loopholes or gaps for abuse. Its hard to have a large bureaucracy thats flexible.
Setting aside that specific guyâs situation, there should certainly be ways to improve the benefits and social safety net to better incentive work.
Iâd generally like to see any benefit have a sliding scale so that you can work and still receive some benefits but have the benefit taper off to zero. Food stamps works that way doesnât it?
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They arenât in school in the summer, which is why I used the peak number from July. Obviously there are always going to be kids that donât have to work because their parents give them money, and itâs possible that more parents today give their kids money to satisfy wants than in the past, but is that number so high that it represents most of the 16% decline? I donât think so. Hard to quantify, but thatâs just my guess. Youâre free to disagree, of course.
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OK yeah I missed the point about it being July in the summer.
https://www.bls.gov/opub/ted/2015/summer-youth-employment-in-july-2015.htm
Why donât youth work?
Theres many reasons :
One chart I found interesting in that article is the % of teens enrolled in school year round and in July.
From the 80âs til today the % of teens enrolled in school year round went from ~60% to ~75-80%
Thats just teens age 16-19 and you were talking 16-24 year olds but the fact that so many are going to shool year round is part of it.
Another one :
"Part of the trend, says one recruiting firm, is teenagers are turning up their nose at minimum-wage jobs.
âSome teens have dropped out of the labor force due to discouragement, this group represents a tiny portion of the rising number of 16- to 19-year-olds abandoning the labor force by choice,â said a recent report from recruiting firm Challenger, Gray and Christmas. âThe rising number of teenagers not wanting to work is not a post-recession trend. While the number of 16- to 19-year-olds not in the labor force who want a job has remained relatively flat since the mid-1990s, the number not wanting a job has steadily increased.â
Abolishing MW sure wonât fix that.
That chart is confusing me. The numbers are so much different than I expected that I had to google it The first two links I found about how many year round schools there are said that only 10% of schools are year round. How is the percentage of students year round 75%? Then the fact that it says 75% of kids are in year round schools, which leaves 25% that arenât, how are there also 40% of kids in July classes unless there is overlap? Iâm wondering what definition they are using for year round school. But the point that more kids are likely in school in the summer no doubt has an effect on the labor force participation rate, so thanks for bringing it up. But then there is the chick vs. egg question. Are parents forcing kids to do more summer classes and enrichment programs because they canât get jobs, or vice versa?
Yeah that chart is confusing. Iâm now thinking actually that the âyear roundâ figure is the % of kids that are enrolled in school, period. Not meaning âyear roundâ = â12 months a yearâ but simply the % who attend school at all. Saying âyear roundâ is confusing in that context. But it really donâst make sense that 75% of kids are in a 12 month school as few shools do that. But the % who are in school in July is still fairly high at ~40% now, but thats a combination of the 12 month schools plus kids optionally (or not) taking summer classes.
The CS Monitor article says : "More than 50 percent of teenagers attended summer school in 2009"
So thats another source for a fairly high % in summer school.
.
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Minimum wage laws make no sense to me. It is a law that says that if the output of your skills and labor are not worth $x to someone hiring, it is illegal for you to have a job.
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Yeah, that wasnât the best example. Youâd want both of them to be worth hiring at 2/3 MW instead of just 1 at MW, and then have an incrementally encouraging welfare system so that maybe they both still get 1/2 the benefits of a non-worker. This way the government pays the same benefits, the workers get 7/6 of MW each so both are better off than before, and the company gets 2x the manpower at only 1.3x the cost.
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Business donât pay people based on what their skills and labor output are worth. Theres no formula saying, well we can hire you to wash dishes for $6 an hour cause your dishwashing productivity skill is valued at $6.
Business pay people based on how little the business can get away with paying for people. The formula is in reality, : we need a dishwashwer. whats the least amount of money someone will wash dishes for?
Minimum wage sets a legal minimum threshold for what a business can get away with paying someone.
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YES !
Both jerosen and I both delineated exactly that, TWICE.
Historical data reveals just the opposite of those opinions.
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Employment has increased subsequent to every time the Federal Minimum Wage has been increased.
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Mark Zandi, who was the economic advisor to the 2000 presidential campaign of John McCain, has pointed out that unlike those in income levels above them, those earning the minimum wage spend 95%+ of any increased wages straight back into the economy.
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Goldman Sachs conducted a simple evaluation of the impact of the various initiative/referendum state minimum wage increases. GS compared the employment change in the 13 states where the minimum wage increased with the changes in the remainder of the states. The GS analysis found that the states where the minimum wage went up had faster employment growth than the states where the minimum wage remained at the same level.
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According to the CBO, of those earning the minimum wage:
80% are adults over 20 years of age
70% have a high school diploma
10% have a college degree
53% work full time
25% have children
Thats an interesting bit of data. Where did you see this?
Iâm curious if it excludes wait staff or anyone otherwise getting tips. I believe a large % of people on MW are in that category and I doubt they get raises.
Can you cite one of those economists?
Thanks for correcting this. Those wages are set by the relative bargaining power between employers and employees (heavily tilted in the employerâs favor with low-skill jobs like that), not by the value of their output.
No legal minimum wage but a high union rate is another workable solution, as scripta mentioned.
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âThe inverse relationship between quantity demanded and price is the core proposition in economic science, which embodies the presupposition that human choice behavior is sufficiently rational to allow predictions to be made. Just as no physicist would claim that âwater runs uphill,â no self-respecting economist would claim that increases in the minimum wage increase employment. Such a claim, if seriously advanced, becomes equivalent to a denial that there is even minimal scientific content in economics, and that, in consequence, economists can do nothing but write as advocates for ideological interests. Fortunately, only a handful of economists are willing to throw over the teaching of two centuries; we have not yet become a bevy of camp-following whores.â
~James M. Buchanan, 1986 Nobel laureate in economics, writing in the Wall Street Journal on April 25, 1996
A few reviews of the literature along similar lines.
The value of their output certainly sets a ceiling on the wage. If what the guyâs doing is worth $10, Iâm certainly not paying him $100 to do it. Would you?
Stats on the upward mobility of MW earners would certainly be interesting. If decreasing MW increases employment of MW workers, assuming the same % are upwardly mobile, society as a whole would certainly benefit.
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No, no. Iâd say abolish the paper money system with a new fanged mobile payment system. What better way to track your citizens? Oops, meant to say deliver convenience while enhancing hygiene from not having to handle the dirty money notes.
Could even have your personal heroes give you an animated wink, thumbs up or what not with every transaction. Heros like Obama, Clinton, Pelosi, Lenin, Murado, Mao, Stalin and all that.
Yeah Iâm sure the communist party invented Visa, MC, Paypal and Bitcoin.
Cause thats what they do : innovate financial transactions systems.
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Trumpâs proposed 25 cent per gallon increase in the gas tax would wipe out two-thirds of the savings from the temporary tax cuts flowing to part of the Middle-Class.
Obviously, those in the Middle-Class who derived no tax cut and those in the Middle-Class who had their taxes increased, will suffer an additional burden.
It was a flim-flam from the getgo.