"Where have all the workers gone?" David Wessel of the Wall St. Journal wondered about the labor force this week:
“In the past two years, the number of people in the U.S. who are older than 16 (and not in the military or prison) has grown by 5.4 million. The number of people working or looking for work hasn't grown at all.”
So, where have all the workers gone? Have they retired, suspended their labors temporarily, or are they languishing on public assistance? Asks Wessel.
There are some other possibilities. Since the crash of 2008 there’s no question that millions of Americans have indeed stopped looking for a job. But that doesn’t necessarily mean they’re not working. Look around, it’s much more likely that the officially “unemployed” are busy, doing their best to make ends meet in whatever ways they can. Sex-work drugs and crime spring to mind, but the underground or “shadow” economy includes all sorts of off-the-books toil. From baby-sitting, bartering, mending, kitchen-garden farming, and selling goods in a yard sale, all sorts of people -- from the tamale seller on your corner, to the dancer who teachers yoga – are all contributing to the underground economy along with “employed” who pay them for their wares.
The “underground” is always with us. For better and often for worse, it’s how marginalized populations tend to survive —often not very well. (Think of the old, the young, the formerly incarcerated, or foreign.) In recessions – surprise, surprise– “irregular” employment grows. Consider recent stories from Greece, about wageless public “workers” swopping skills, and trading food for teaching. Austrian economist, Friedrich Schneider, an expert in underground economies, has documentd a surge in shadow economy activity in 2009 and ’10 in Europe. University of Wisconsin-Madison economist Edgar Feige has been doing his best to follow what’s happened here.
Published on Friday, May 18, 2012 by The Nation