Why has the percentage of the population that’s in the work force declined so dramatically? It’s a question many have asked, and Gordon T. Long and I attempt to answer in our most recent video program The Participation Rate Mystery–Solved.
Why does the Participation Rate matter? Intuitively, we all understand that the lower the participation rate (i.e. the percentage of the population with a job or actively looking for a job), the greater the tax burden on the remaining workers.
Despite a ceaseless propaganda campaign declaring all is well with the U.S. economy, the Status Quo is fragile–and voters know it. Not only do they know the economy–and their financial security–is one crisis away from meltdown, they’re also fed up with all the official gerrymandering of data to make the economy appear healthy.
The Economy Is Better — Why Don’t Voters Believe It?
The American Dream–characterized by plentiful jobs offering living wages, security and opportunities to get ahead–is over, and voters know this, too.People are realizing the U.S. economy has changed qualitatively in the past 20 years, and claims that it’s stronger then ever ring hollow to people outside Washington D.C., academic ivory-towers and ideologically driven think-tanks.
Promises of wealth and security are far more contingent than is being advertised.
The Millennial Generation, if we’re to believe various polls, aspires to either make boatloads of money on Wall Street, or secure a can’t-be-fired job in the government. Given the dominance of finance and an economic backdrop of rising insecurity, these are rational choices.
But all those Millennials hoping to work for Goldman Sachs does raise a question:when did playing financial games become so much more profitable than producing goods and services?
And that raises another question: is the dominance of the FIRE sectors (finance, insurance, real estate) permanent or cyclical?
There are four structural drivers behind the soaring costs of the middle class lifestyle.
Why have the costs of a middle class lifestyle soared while income has stagnated?Though it is tempting to finger one ideologically convenient cause or another, there are four structural causes to this long-term trend:
Tagged with: Baumol's cost disease
, compensation costs
, corporate profits
, external costs
, global corporate capital
, Immanuel Wallerstein
, labor costs
, middle class