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The Not So Golden Years, Revisited
Posted By Invictus On June 3, 2012 @ 12:00 pm In Contrary Indicators,Cycles,Data Analysis,Economy,Employment,Inflation,Really, really bad calls | Comments Disabled
Over the years, debate has waxed and waned over the effects of the minimum wage and/or immigration policy on employment, particularly teen/youth employment. When the issue flared up most recently, a couple of years ago, I posted a rebuttal to that argument here , my point being that it was – at least this time around – crappy demographics and a lousy economy that had older workers staying in – and re-entering the labor market to seek – jobs far longer than we’d seen previously:
What about demographics — an aging boomer population — and a crappy economy that has the 55+ cohort postponing retirement  and consequently crowding out the younger generation (parents keeping their own kids/grandkids out of the job market, as I put it a while back). The data is there for all who choose to explore it.
A short while after that post appeared, BR got a request to reprint from the folks at Cengage Learning/Greenhaven Press, who asked if they could include the article in their academic Opposing Viewpoints  series of books. I obviously consented to allow the piece to be reprinted, and the book was recently published (specific URL for the volume on Minimum Wage is here ). I’m flattered that I’ve now had a piece published, a first for a me. I’m also very appreciative to BR – as he well knows – for his willingness to give me a little corner of his soapbox, and hope I provide some value-add to TBP readers. (My stipend for the piece went to a local humane society.)
That said, why not revisit the issue of youth employment and see where we now stand?
Here is how employment growth (or lack thereof) has evolved, by age cohort, since the beginning of the Great Recession:
(Source: St. Louis FRED, Series LNS12000012, LNS12000036, LNS12000089, LNS12000091, LNS12000093, LNS1202423)
And here’s a different look at the exact same data, an update of the chart I ran two years ago:
Very coincidentally, as I was working on this post, David Rosenberg commented on this very topic, including a variant of the chart immediately above. Rosie’s take on the situation (Breakfast with Dave , May 29, 2012):
Even if some of us dream about becoming a paid consultant in our golden years, the reality is the re-entry of boomers into the workforce is a case of having to, not wanting to. It is what is essential to retire with dignity, not some desirable lifestyle change. Employment for those 55 and up have risen to new all-time highs this cycle while everyone else is languishing nine million below the 2007 peak. [...] There are a few side effects from the bulge in employment for the 55-and-up segment of the population. One is that by not leaving the workforce as they have done in the past – going for early retirement – they have created a backlog of unemployment among the youth.
Precisely. With the benefit now of some hindsight – I made my original argument in real-time – I think it’s clear that it has been, in fact, demographics and a crappy economy that accounts, for the most part, for our youth unemployment problems. (Finally on this topic, Rosie notes that the older cohort “has not seen an erosion in its participation rate or in its employment-to-population ratios.”)
Shifting gears now to make sure I cover as much of the waterfront as I can, several unrelated tidbits:
I wish I had authored this brilliant piece  by Mark Dow, which really resonated with me. As the old saying goes, “If the only tool you’ve got is a hammer…” Mr. Dow’s piece is spot-on in every regard.
With interest rates in many parts of the world hitting all-time record lows , I’d be remiss if I didn’t give a shout-out to the inflation hawks of the past few years. To those who foretold a spike in interest rates and hyper-inflation – Jerry Bowyer , Arthur Laffer , the Wall St. Journal , et. al., – here’s to you. An object lesson in putting ideology over analysis. (As an aside on bonds, rates, equities…well…this .)
There appears to be some tin foil hat commentary, to which I won’t link, to the effect that DOL is cooking the books because the weekly Unemployment Insurance Claims revisions are almost always higher in the hope of making the Obama economy look better than it is. The thinking appears to be:
A few comments:
Finally, I highly recommend to all It’s Even Worse Than It Looks  by Thomas Mann & Norman Ornstein, two long-time congressional scholars, on the roots and current status of our calamitous dysfunction in Washington. See their April WaPo op-ed piece here . You may not have heard of their new book because, sadly, as Greg Sargent points out , the duo are being totally ignored by the Sunday talk shows.
Article printed from The Big Picture: http://www.ritholtz.com/blog
URL to article: http://www.ritholtz.com/blog/2012/06/the-not-so-golden-years-revisited/
URLs in this post:
 here: http://www.ritholtz.com/blog/2010/06/its-the-minimum-wage-no-its-illegals-oy-vey/
 postponing retirement: http://thehiringsite.careerbuilder.com/2009/03/23/60-of-over-60-workers-postponing-retirement-finds-careerbuilder-survey/
 Opposing Viewpoints: http://www.gale.cengage.com/servlet/BrowseSeriesServlet?cf=ps®ion=9&imprint=070&titleCode=GOVPL&page=1
 here: http://www.gale.cengage.com/servlet/ItemDetailServletCr?region=9&imprint=070&cf=p&titleCode=GOVPL&type=3&dc=null&dewey=null&id=262357
 Image: http://www.ritholtz.com/blog/wp-content/uploads/2012/06/teen-unimployment-1.png
 Image: http://www.ritholtz.com/blog/wp-content/uploads/2012/06/teen-unemployment-2.png
 Breakfast with Dave: http://www.gluskinsheff.com/Research.aspx
 this brilliant piece: http://markdow.tumblr.com/post/24081371136/reagans-gone-youre-old-get-over-it
 all-time record lows: http://www.ritholtz.com/blog/2012/06/low-yields-everywhere/
 Jerry Bowyer: http://www.nationalreview.com/articles/227903/were-all-inflation-hawks-now/jerry-bowyer
 Arthur Laffer: http://online.wsj.com/article/SB124458888993599879.html
 Wall St. Journal: http://online.wsj.com/article/SB124347148949660783.html
 this: http://www.ritholtz.com/blog/2012/04/seen-this-movie-before/
 It’s Even Worse Than It Looks: http://www.amazon.com/Even-Worse-Than-Looks-Constitutional/dp/0465031331/ref=sr_1_1?ie=UTF8&qid=1338649530&sr=8-1
 here: http://www.washingtonpost.com/opinions/lets-just-say-it-the-republicans-are-the-problem/2012/04/27/gIQAxCVUlT_story.html
 Greg Sargent points out: http://www.washingtonpost.com/blogs/plum-line/post/only-one-partys-to-blame-dont-tell-the-sunday-shows/2012/05/14/gIQAXOcPPU_blog.html
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