America’s declining incarceration rate and the job market
By American Enterprise Institute
Trying to illustrate the tough job market, Federal Reserve boss Janet Yellen on Monday told a Chicago conference about two long-term unemployed Americans. Both, it turns, had prison records (And now both have jobs.) As the WaPo’s Ylan Mui points out, “workers with criminal histories are not an anomaly in the labor force” given that nearly one-third of Americans have been arrested by age 23 with 12 million to 14 million convicted.”
And interesting side question is how US incarceration rates affect the macro labor market. Researchers Larry Katz and Alan Krueger in the late 1990s claimed that rising rates contributed to a 0.3%-point to the decline in the official male unemployment rate. Men In jail doesn’t get counted by the Labor Department.
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