By Tim Worstall at Forbes
June 21, 2016
The Council of Economic Advisers has released a report through the White House looking at the problem of declining labour market participation rates among prime aged males. If this is all entirely voluntary then this isn’t a problem of course – glory to be alive in a society rich enough that some people don’t have to work. If it’s involuntary then it is a problem, a problem on two grounds. One is that we know that involuntary unemployment is one of the most misery inducing experiences that a human can go through, the other is that we’re missing out on those things that could be produced by that willing labour.
So this is definitely a problem that we should all be looking at, trying to puzzle our way through. But of course, when looking at absolutely any economic problem we have to be aware of the definitions of the statistics that we’re using. Not just what are the numbers but how are they composed? That composition being the key to what the numbers are actually telling us. And the thing is, this CEA report doesn’t pick up on a very important difference in the way that these numbers are compiled across countries.
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