Just a few weeks ago, the Federal Reserve Bank of San Francisco was saying that enhanced immigration would result in boosted productivity, enhanced investment and general economic awesomeness. Today, the West-Coast central bankers are hanging their hats on the rehiring of people who’ve left the workforce as the recession deepened. To wit: Teenagers (as ususal), old people and “prime-age men” must re-enter the economy in order to provide it with the jolt it desperately needs.
Since the 70s, teenagers have been working less and less, because they’ve been going to school instead. They’re also subject to fierce whipsaws when the economy goes south, because they have no skills and are not particularly committed to the workforce. “Prime-age men” have also been working less in recent decades, because when they lose their jobs they stay out of the job market. This is because of increased availability of disability benefits and lowered demand for less-skilled workers. Shocking stat! “Almost 4.5% of the adult male population is receiving disability benefits in 2010.” And men who get on disability tend to stay away from work after they start receiving benefits.
The only group to show any industriousness has been old people, despite their determination to ruin our economy. Eroding retirement programs have put seniors back to work. “Although it is very difficult to predict the magnitude of future increases in the labor force participation rate of older workers, it’s something labor market experts must watch closely,” write San Francisco Fed economists Joyce Kwok, Mary Daly and Bart Hobijn. “Older people now make up almost a third of the population. Their labor force participation has particularly important implications for the aggregate labor supply.”