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NewDealdemocrat — China, not automation, is by far the biggest factor in the decline of prime age labor force participation

Summary:
Perhaps the biggest mystery in economic analysis in the last few years has been trying to find an explanation for the big decline in labor force participation since 1999. A recent NBER working paper by Abraham and Kearney has posited the most comprehensive answer to date. Since it was summarized in this Washington Post article, I’m just going to quote a few paragraphs and suggest that you read the entire article.... Angry BearChina, not automation, is by far the biggest factor in the decline of prime age labor force participation NewDealdemocratSee also As is clear from the chart above, the employment-population ratio (the blue line) has collapsed from a high of 64.4 in 2000 to 59 in 2014 (and had risen to only 60.1 by the end of 2017).* During the same period, the average real

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Perhaps the biggest mystery in economic analysis in the last few years has been trying to find an explanation for the big decline in labor force participation since 1999. A recent NBER working paper by Abraham and Kearney has posited the most comprehensive answer to date. Since it was summarized in this Washington Post article, I’m just going to quote a few paragraphs and suggest that you read the entire article....
Angry Bear
China, not automation, is by far the biggest factor in the decline of prime age labor force participation
NewDealdemocrat

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As is clear from the chart above, the employment-population ratio (the blue line) has collapsed from a high of 64.4 in 2000 to 59 in 2014 (and had risen to only 60.1 by the end of 2017).* During the same period, the average real incomes of the bottom 90 percent of Americans have stagnated—barely increasing from $37,541 to $37,886.
That should be indicator that the problem is on the demand side, that employers’ demand for workers’ labor power has decreased, and not the supply side, that workers are choosing to drop out of the labor force.
But, as I explained back in 2015, that hasn’t stopped mainstream economists from blaming workers themselves—especially women and young people, for being unwilling to work and turning instead to public assistance programs and raising children and being distracted by social media and digital technologies, as well as Baby-Boomers, who are choosing to retire instead of continuing to work....
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David F. Ruccio | Professor of Economics, University of Notre Dame

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Mike Norman
Mike Norman is an economist and veteran trader whose career has spanned over 30 years on Wall Street. He is a former member and trader on the CME, NYMEX, COMEX and NYFE and he managed money for one of the largest hedge funds and ran a prop trading desk for Credit Suisse.

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