by Mish Shedlock, Mish Talk:
President Trump, like President Obama before him, point out the low unemployment rate as a measure of success.
What they don’t point out are masses of people on welfare via fraudulent disabilities, people in school wasting money in dead-end retraining exercises, people who have simply given up looking for a job, and people in forced retirement needing Social Security payments to survive.
A team of researchers from Princeton, the University of Chicago, and the University of Rochester discusses another class of individuals who are not working but are not counted as unemployed: People, primarily young men who are addicted to games. For such individuals, games provide a fantasy world that is far more enjoyable than the real world.
Please consider their report on Leisure Luxuries and the Labor Supply of Young Men.
Between 2000 and 2015, market hours worked fell by 203 hours per year (12 percent) for younger men ages 21-30, compared to a decline of 163 hours per year (8 percent) for men ages 31-55. These declines started prior to the Great Recession, accelerated sharply during the recession, and have rebounded only modestly since. We use a variety of data sources to document that the hours decline was particularly pronounced for younger men.
Not only have hours fallen, but there is a large and growing segment of this population that appears detached from the labor market: 15 percent of younger men, excluding full-time students, worked zero weeks over the prior year as of 2016. The comparable number in 2000 was only 8 percent.
A natural question is how these younger men support themselves given their decline in earnings. We document that 67 percent of non-employed younger men lived with a parent or close relative in 2015, compared to 46 percent in 2000.
One avenue to gauge how younger men perceive their fortunes is to use survey data on happiness. In this spirit, we complement the patterns in hours, wages, and consumption with data on life satisfaction from the General Social Survey. We find that younger men reported increased happiness during the 2000s, despite stagnant wages, declining employment rates and increased propensity to live with parents/relatives. This contrasts sharply with older men, whose satisfaction clearly fell, tracking their decline in employment.
Annual Hours and Employment Rates