Employment

A few years back in the American Prospect, Linda Hirshman argued that the leveling off and decline of women's employment wasn't due to a bad economy, but rather the fault of what she labeled "choice feminism" which encouraged mothers to "opt out" of the workforce and care for children. She later wrote the charmingly titled book "Get to Work!"

Since then economist Heather Boushey has throughly debunked the opt out myth. In yesterday's NYT she pounded another nail in its coffin:

“When we saw women starting to drop out in the early part of this decade, we thought it was the motherhood movement, women staying home to raise their kids,” Heather Boushey, a senior economist at the Joint Economic Committee of Congress, which did the Congressional study, said in an interview. “We did not think it was the economy, but when we looked into it, we realized that it was.”

The full report is available on the JEC's website. Among the findings:

• Over the past three decades, only those families who have a working wife have seen real increases in family income.

• The 2001 recession hit the jobs that women held especially hard. Unlike in the recessions of the early 1980s and 1990s, during the 2001 recession, the percent of jobs lost by women often exceeded that of men in the industries hardest hit by the downturn.

• The lackluster recovery of the 2000s made it difficult for women to regain their jobs –women’s employment rates never returned to their pre-recession peak.

• If the prior recession’s trend holds, women will suffer equally to men in the 2008 recession. Because women are disproportionately represented in state and local government services, their job losses are likely to grow in the latter part of the recession as state and local governments are forced to implement cut-backs in spending in areas that women are disproportionately employed, such as education and health care.

An underreported finding from last Friday's jobs data is that people are increasingly being forced to take part time jobs. The numbers here already exceed their highest levels in the last recession. This chart, from a newly updated CLASP report on how the downturn is affecting low-income folks, shows what's going on.

See this NYT article for more on the people behind the numbers.

I'm not a huge fan of "the rolls are rising" stories, but today's NYT story on food stamps by Erik Eckholm isn't too bad:

Driven by a painful mix of layoffs and rising food and fuel prices, the number of Americans receiving food stamps is projected to reach 28 million in the coming year, the highest level since the aid program began in the 1960s.

....

... recent rises in many states appear to be resulting mainly from the economic slowdown, officials and experts say, as well as inflation in prices of basic goods that leave more families feeling pinched.

....

“People sign up for food stamps when they lose their jobs, or their wages go down because their hours are cut,” said Stacy Dean, director of food stamp policy at the Center on Budget and Policy Priorities in Washington, who noted that 14 states saw their rolls reach record numbers by last December.

Although the story places too much emphasis on rise in the absolute number of people receiving food stamps by confusingly characterizing the current number as a "record"—it isn't until a few paragraphs down that you learn that the percentage of Americans receiving food stamps is still lower in percentage terms than in the 1990s recession—it does a good job of noting the economic factors, inflation, unemployment, and low wages, that are responsible for the rise.

It shouldn't really be news that more workers are receiving help from the food stamp program as the economy turns down—the program, after all, is a form of social insurance that protects workers against earnings drops. But it isn't always the case that programs like food stamps do what they're supposed to do when more workers need help. In the last recession, Temporary Assistance—essentially unemployment insurance for low-wage workers with kids—actually helped fewer workers than it did before the recession, and a repeat performance appears likely.

According to social surveys, Denmark is the happiest country in the world, a fact that apparently isn't sitting to well with some people at the NYT. In a piece that should have ran in the National Review, Carter Dougherty tries to make the case Denmark is going to hell in a handbasket as young, highly educated workers "flee" to avoid the country's top marginal tax rate of 63 percent.

CEPR's Dean Baker and Time's Justin Fox have debunked the piece in recent blog posts. Baker notes that the net rate of the "net rate of departure is supposedly 1000 people per year, approximately 0.002 percent of the population" and that "the article presents little evidence that the economy is suffering from this exodus."

Denmark currently has a 3.6 percent unemployment rate. Its economy is projected to grow by 3.5 percent in 2007. The article warns us that growth will fall to 1.0 percent over the next three years. (The main reason for the projection of slower growth is a U.S. style housing market crash. Denmark's central bankers were no smarter than Alan Greenspan.) Of course, since Denmark's population is barely growing, that translates into about 0.7 per capita growth, the number that economists usually care about. That's not great, but not exactly a nightmare.

In terms of sustainability, Denmark has a budget surplus of more than 2 percent of GDP (equivalent to $280 billion a year in the U.S.) and a debt to GDP ratio of around 26 percent. Its current account surplus is also in excess of 2 percent of GDP.

In short, if Denmark is suffering because a relatively small number of highly educated workers find the tax rate too high, there is not much evidence in the data.

Fox concludes that the inclusive Danish welfare state has bolstered the country's economic growth:

.... tight-knit culture and the hugely expensive Danish welfare state both seem to have contributed in a big way to the country's impressive economic success over the past 15 years. So maybe encouraging immigration by cutting taxes (and with them the size of government) isn't the best possible solution to Denmark's labor shortage. What is? Having more kids, I guess.

Given the weak evidence for Dougherty's "something is rotten in Denmark" thesis, and since the NYT piece was presented as a news story, it should have at least acknowledged that plenty of experts view Danish tax policy as an asset rather than a liability.

Beckett and I mosied over to Capitol Hill yesterday to hear CEPR economist John Schmitt debate Stephen Rose on the topic of good jobs. As Schmitt has documented in some excellent recent studies, we have a lot fewer good jobs than we should given economic growth and productivity trends. After the debate, I took a look at Rose's most recent paper, and ran across this puzzling statement:

As a general rule, middle-class jobs are not disappearing. Rather they are being replaced often—though not always—by higher-paying jobs.

Got that? Middle-class jobs aren't "disappearing", they're just being "replaced." Call me polemical, but this seems like hair-splitting. Regardless of the euphemism one uses to describe the trend, we have relatively fewer jobs that pay middle-class wages. Yes, we have relatively more jobs that pay better than middle-class wages, but we also have more jobs that pay less than middle-class wages (and don't provide middle-class benefits). This trend is what many people refer to non-euphemistically as an increase in inequality.

Part of Rose's argument seems to be political, ie, talking about the economy in critical terms isn't persuasive to most voters in his view. But given that more than half of Americans currently rate the national economy as "bad", "very bad", or "terrible", it's an odd time to be making that argument.

Margy blogged last week about Made in L.A., the new documentary film we're helping to promote. It's being broadcast on lots of local PBS stations over the next couple of weeks (next Monday on WETA, for instance). Here's the trailer.

Inclusion's Mobility Agenda and PRRAC recently co-sponsored a roundtable conversation to discuss the research evidence and promising practices for employment and housing mobility with some of the most knowledgeable people in the field.

At the meeting we discussed employment -- economic success and inclusion -- for low-wage households living in dispersed housing, particularly those moving from impacted high-poverty neighborhoods to less impacted communities, and cataloguing promising practices to improve the economic outcomes and social inclusion for employees, employers, and communities.

The meeting was “first of a kind” in a number of ways.

• The participants included an unusual combination of people who don't often sit around the same table: academic researchers, local providers and advocates, and policy analysts from all levels of government.

• Similarly, the presenters came from a few different issue areas -- housing, metropolitan, transportation, economy, labor market, non-profit sector, child care, and civil rights -- sometimes called issue "silos" when leaders develop strategy in isolation.

• We made our first foray into “taping” for online presentation. (We learned a lot….lessons we’ll put to good use at our next event.)

For a great deal of information about the intersection between housing and employment, check out the web page we’ve created. (Research Assistant Sarah Sattelmeyer is “AWESOME”!) On the page you’ll find all of the presentation materials, background reading, and video of much of the event along with a photo gallery.

Inclusion's work on this topic is supported by the Annie E. Casey Foundation.

The conclusion of an interesting new working paper by Judith Hellerstein, David Neumark, and Melissa McInerney concluding that "spatial mismatch" plays a relatively minor role in low employment rates of black men, and that discrimination and labor market network issues play a larger role:

The spatial mismatch hypothesis implies that the location of jobs affects employment prospects. According to this hypothesis, the location of jobs coupled with residential segregation and mobility barriers and costs combine to reduce black employment rates, especially among those with lower skills. In this paper we contrast the spatial mismatch hypothesis with what we term the racial mismatch hypothesis. The latter hypothesis suggests that the problem is not a lack of jobs, per se, where blacks live, but a lack of jobs into which blacks are hired, whether because of discrimination or labor market networks in which race matters. Under the racial mismatch hypothesis, it is the local availability of jobs for (or held by) members of one's own race that matters for employment.

....

... The findings, in our view, are quite striking. It is primarily black job density that influences black employment, whereas white job density has little if any influence on the employment of blacks. Moreover, we find similar patterns with respect to differences in effects associated with schooling; black job density at lower education levels has a stronger effect on employment of blacks, and in particular for those blacks with less education.

This evidence does not repudiate the importance of the spatial distribution of jobs, given that we are still studying the effects of job density in one's area of residence. What it suggests, however, is that race plays a key role, and that the availability of jobs locally is not enough to markedly impact black employment rates. Thus, pure spatial mismatch is not an important component of lower black employment rates; instead the spatial distribution of jobs available to blacks appears to be much more important. We have termed this "racial mismatch," for short, to contrast it with the usual spatial mismatch story, and to emphasize the critical influence of race.

... many evaluations of ... programs [designed to address spatial mismatch] suggest that they are relatively ineffective at increasing black employment. This is entirely consistent with the results we find here, where simply living near jobs will not boost employment unless those jobs are available to one's own race. Indeed, a simple simulation that we present shows that moving blacks so that they faced the race-specific densities of the representative white in their MSA (with the same skill level) would do relatively little to increase black employment, because the main effect of such a move would be to expose them to higher white (or non-black) job density, which our estimates indicate does little to increase black employment.