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The views expressed are those of the author and do not necessarily reflect the views of ASPA as an organization.
By Fiona Chen
December 2, 2014
As the result of the Great Recession in Europe and North America, there were 10,000 additional “economic suicides” according to a study published in The British Journal of Psychiatry. Led by Arron Reeves and David Stuckler at the University of Oxford and Martin McKee at the London School of Hygiene and Tropical Medicine, this study immediately became national and international news. Results concluded that U.S. suicides increased 4.8 percent during the period, resulting in 4,750 additional deaths. These numbers do not include suicide attempts. The researchers regard the “economic suicides” avoidable and relate the suicide thinking directly to job loss, debt and foreclosure.
On June 5, 2013, analyzing the latest U.S. census data, Sarah Ayres of Center for American Progress reported that young Americans are unemployed at about twice the rate of older workers. Two and half million teens ages 16 to 19 (22.5 percent of the age group population) are either out of work or underemployed. Most alarming, 8.2 million adults ages 20 to 24 (12.5 percent) are either out of work or underemployed.
To put the numbers into perspective, Ayres stated that, “there are more than 10 million Americans under the age of 25 who are currently unable to find full-time work – a number greater than the population of New York City, a city of about 8 million people.”
Ayres observed that college graduates today suffer from high unemployment rates, declining wages, lower-quality jobs and few opportunities for advancement. At the same time, student debt in America has ballooned to more than $1 trillion. One in four student-loan borrowers are delinquent on their loans.
A high rate of voluntarily leaving job since the 2009 downturn was reported by John Schmid in The Journal Sentinel. According to Schmid, Dr. Steven Davis, a professor who specializes in labor economics and worker mobility at the University of Chicago Booth School of Business, interprets the increase of the voluntary job-quit rate as a sign of U.S. economic growth. Dr. Davis also pointed out the creation of over 8 million new jobs since 2009 did not create jobs for young adults and passed by the recent young graduates.
Henry R. Hyatt and James R. Spletzer of the U.S. Census Bureau in February 2013 in the Federal Reserve Bank of Atlanta Noon Lunch Seminar, presented their 35-page longitudinal study of the recent decline in employment dynamics in the 21st century, particularly during the recession of 2001 and 2007-2009.
They defined employment dynamics includes job increases, worker reallocations, hiring and separation, job creation and elimination and job-to-job flows. They concluded that the aging population, increase of the workforce with a bachelor’s degree and a shift toward older firms are factors contributing to the decline.
The authors did not have data to answer why new immigrated workers are able to fill in newly created jobs when the citizens and residents cannot.
We assume that the new immigrants have network information. They follow the advice and the footsteps of their fellow country persons. We need to find such a vehicle that is a trustworthy information flow for young graduates and small businesses in disadvantaged status and in low income areas to relocate and transit to more economically vibrant areas.
This is the picture of today’s U.S. economy and society. We are no longer the economy and society in which everyone who wants to find a job and is willing to work can fulfill the American dream. Certain traditional jobs and business types disappeared or are disappearing from our economy forever.
If an American feels s/he is shameful to beg, does not know-how to survive homeless, and/or is without family economic support, then death by suicide, crime or jail time is not that far from being a realistic alternative.
A July 2014 article on Entrepreneur.com, “The Best Advice You’ll Ever Get,” described 30 innovative businesses to start now and offered advice on how to start such a business. The advice list includes 1) lead like a champ, 2) show strong character, and 3) make money. Nothing printed in the issue is useful for a young unemployed graduate to start a new business.
Using a series of census data and 2009 American Community Survey data for their population trend, I-Fen Lin and Susan L. Brown at the Department of Sociology of Bowling Green State University, published their stunning study result in “Unmarried Boomers Confront Old Age: A National Portrait,” Working Paper Series 2012-03 of The Center for Family and Demographic Research.
They concluded that one in three baby boomers was unmarried. The vast majority of these unmarried boomers were either divorced or never-married. Only 10 percent of them were widowed. They warned unmarried status affects the economics, current and future health, and social vulnerabilities of the aging process of these baby boomers.
As a CPA in Illinois, where the economic recovery is behind the national average, I have personally observed seniors exhausting retirement savings voluntarily check themselves to senior citizen housing once they qualify for the Medicaid age regardless of their health conditions.
Our economy and society can be separated by the have and have-nots. For public administrators, we need to be aware of the need of the have-nots, the empty half of the cup and design our policy preference accordingly.
Author: Fiona Chen, MPA, Ph.D., CPA, ABV, CFF, CITP is president of Fiona Chen Consulting Company, a tax and forensic accounting firm. She can be reached at [email protected]