WASHINGTON — The work ethic is such a central part of the American character that it's hard to imagine it fading. But that's what seems to be happening in one important part of the labor force. Among men 25-to-54 — so-called prime-age male workers — about one in eight are dropouts. They don't have a job and, unlike the officially unemployed, aren't looking for one. They number about 7 million.
Just what role, if any, these nonworking men played in Donald Trump's election is unclear. What's not unclear is that these dropouts, after being ignored for years, have suddenly become a hot topic of scholarly study and political debate. There's been a sea change. In the mid-1960s, only one in 29 prime-age male workers was a dropout. The explosion of dropouts strikes many observers as dire.
The "detachment of so many adult American men from the reality and routines of regular paid labor ... can only result in lower living standards, greater economic disparities and slower economic growth," writes Nicholas Eberstadt of the conservative American Enterprise Institute. "It is also a social crisis — and ... a moral crisis. The growing incapability of grown men to function as breadwinners cannot help but undermine the American family."
A recent report from Barack Obama's Council of Economic Advisers echoes similar concerns. The erosion of prime-age male workers "is particularly troubling since workers at this age are at their most productive," says the CEA. Greater joblessness is linked to "lower overall well-being and happiness and higher mortality."
Why are men abandoning the labor market?
The most important cause of dropping out is declining wages for low-skilled workers, concluded the CEA study. The demand for low-skilled workers is falling faster than the supply, causing wages to drop. From 1975 to 2014, the CEA reported, wages for high-school graduates fell from about 80 percent of wages of college graduates to 60 percent.
As this happens, "more prime-age men choose not to participate in the labor force," said the CEA. Put plainly: They decide that working isn't worth the effort. As for shrinking low-wage employment, the CEA blames "technology, automation and globalization."
Another cause is the large number of incarcerated men. When prisoners get out, their criminal records make it harder for them to find work, said the CEA.
How much, if at all, do government welfare programs encourage labor force dropouts? Eberstadt believes this is crucial, citing studies that roughly two-thirds of households with male dropouts receive disability benefits or other government aid, such as Medicaid. By contrast, the CEA argues that benefits haven't increased fast enough to explain the surge in dropouts.
What can be done to minimize dropouts? Should the Federal Reserve and the Trump administration "run the economy hot" in the hope that faster economic growth will draw some of the 7 million into newly created jobs? Or should disability standards be tightened to force dropouts back into the labor force?
Any debate may turn on whether dropouts are "shirkers" (able-bodied men avoiding work) or "victims" (workers left behind by disability or bad luck). There's evidence of both.