Why are Americans leaving the work force?


Another example of American exceptionalism.

A report by CNN Money indicates that, since the year 2000, the American labor force participation rate—the proportion of working-age Americans with jobs or looking for work—has fallen, while the rate has been increasing in other industrial countries.

I don’t think CNN’s theory—that other countries make it easier for women to work—is the whole story.

Hourly wages, adjusted for inflation, have been falling in the USA since the late 1970s.  For a long time Americans maintained their material standard of living by working longer hours, sending more families into the work force and borrowing money.

Now this has collapsed.   The good jobs are no longer available.  In many cases it makes more sense to cut back on spending than to get a job where low wages are offset by the costs of transportation, child care and the like.

I think—although I don’t claim to be able to prove—that the other countries on the CNN chart are following the same path as the United States, but are not so far along.

One straw in the wind is the increasing number of Europeans who are working “extreme” working hours—50 hours a week or more.   This is pretty much the trend in the USA during the 1990s.

I think the best explanation for what is going on is the Marxist one.   In all the rich countries, there is an increasing flow of income to holders of financial assets and to people in executive positions and a decreasing flow to the middle class, working people and the poor.


Why America’s workforce is shrinking and Europe’s isn’t by CNN Money.

Extreme working hours have radically increased in many western European countries since the start of the 1990s by Anna S. Burger of the London School of Economics.

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