NY Times - Post 2008 White Labor Force Declines
Unusual Demographic Trends - Labor Force Declines
ECONOMIC SCENE DEC. 16, 2016
To what extent did whites miss out on the economic recovery?
My column this week aimed to shed light on the enthusiastic embrace of Donald J. Trump’s insurgent candidacy by white working-class voters. Economics, I argued, probably played a more important role than analysts have been willing to concede.
While Hispanics, African-Americans and Asian-Americans have millions more jobs now than they did at the labor market’s high-water mark in November 2007, before the economy turned into recession, whites actually lost 700,000 more jobs than they gained.
It is hardly surprising, I argued, that the whites living outside big cities who were broadly bypassed by the millions of new jobs created during the recovery would vote against the status quo.
But what if something else is going on? Whites are older, on average, than members of other racial and ethnic groups. They are aging out of the labor force more quickly than blacks or Hispanics. Might this account for the differences in the number of raw jobs lost? Perhaps it’s just that more whites retired?
Not quite.
Across the entire population, the employment rate for whites has declined more sharply since the prerecession peak than for other ethnic and racial groups, sliding to 60.1 percent from 63.6 percent of the population 16 or older, seasonally adjusted. For Hispanics the share declined somewhat less, to 61.9 percent from 64.7 percent. For blacks, it slid only slightly — to 56.9 percent from 57.8 percent. (The overall number of people with jobs rose nonetheless, because of population growth.)
The pattern is replicated across narrower age cohorts too. Consider only people from 25 to 54. From November 2007 to November 2016, the share of whites in that prime working-age bracket who held a job declined by two percentage points — to 79.4 percent from 81.4 percent. (The employment rate for prime-aged workers by race and ethnicity is not seasonally adjusted.) That means that almost two million fewer whites of prime working age have a job than if they had maintained the same employment rate of nine years ago.
What about everybody else? The share of Latinos at work in that age group also declined — but the fall was more muted, to 75.7 percent last month from 76.9 percent at the peak. Had they maintained the same employment rate as in November 2007, almost 300,000 more prime-aged Latinos would be working.
Asian-Americans of prime working age did lose proportionately more jobs than whites — their employment rate fell to 76.2 percent from 79 percent. But the employment rate of African-Americans in this category actually increased. Last month 74.5 percent of prime-aged blacks held a job, 0.3 percentage points more than in November 2007.
The pattern actually looks worse for whites in the decade preceding retirement. The employment rate of whites from the ages of 55 to 64declined slightly — to 63.6 percent from 64.1 percent. By contrast, the employment rate of blacks, Hispanics and Asians increased.
Is there a demographic in which white employment rate grew? Yes, older whites. Among whites 65 or older, 18.7 percent work. That is almost three percentage points more than before the recession.
Delayed retirement is clearly feeding into this trend. But as Lakshman Achuthan of the Economic Cycle Research Institute pointed out to me, the low-wage service industry tends to employ lots of workers in this demographic group. Think of Walmart greeters.