In June, the U.S. economy added 223,000 jobs and unemployment fell to its lowest rate in seven years. But the proportion of Americans working or looking for work is now the smallest it’s been in nearly four decades, and wages remain flat. For an in-depth outlook on employment, Judy Woodruff speaks to Harry Holzer of Georgetown University.
“The monthly labor force participation rate dropped to 62.6 percent, the lowest rate observed in many years,” said Holzer. “We always knew that participation would decline as the Baby Boomers retired, but labor force activity has also declined among those below the age of 55, and so far those numbers have recovered fairly little.”
“There may be a little bit of buyers’ remorse going on in some state capitals right now,” said Sabrina Corlette, the director of the Center on Health Insurance Reforms at Georgetown University. She said states underestimated the difficulty and expense of building and maintaining state marketplaces. Now, she said, many officials are asking: “What did we get ourselves into?”
“Paradoxically, unemployment insurance systems sometimes include requirements that discourage individuals from engaging in the kinds of activities that could help them eventually obtain productive employment," Adriana Kugler, Vice-Provost for Faculty and Professor at the McCourt School of Public Policy, on revising the current system of unemployment insurance.
The Illinois program may prove to be an appealing prototype. (First it will need approval by the Department of Labor and IRS.) Still, each state is crafting its own version. In Connecticut, the automatic IRA may be paid out as a lifetime annuity or in a lump sum. Indiana is looking at setting up a voluntary plan with a tax credit. “States are a great laboratory for experimentation,” says Kathleen Kennedy Townsend, founder of Georgetown University’s Center for Retirement Initiatives.