Question

What are possible policies that we can implement to increase the LFPR for African American Men?

In class we learned that the labor force participation rates for African American men are significantly lower than that of white males. There are multiple reasons behind this case. African American males tend to be less educated, resulting in lower skills. Unskilled laborers lack the necessary demand in the workforce today. Additionally, discrimination is the biggest driving factor. As witnessed ever so clear this year, racial tensions can affect labor force participation rates. Companies and firms may not hire individuals based on the color of their skin. Additionally, we learned that residency and frictional unemployment can cause/be an issue. This argument appeared in the study of Detroit too. While there may not be jobs in a certain area, it is expensive to move in an attempt to find a new career. These are just a few reasons as to why African-American males are falling behind in the LFPR category. What are some policy implications that can help increase these numbers in the future?

Answer 1

Some policies Implications that can help to increase the LFPR of African-American males are-

1. IMPROVE WORKFORCE TRAINING

   Over the past few decades, globalization, trade, and technological advancements have grown the economy, improved quality of life, and created jobs. These developments have also significantly changed the skills that employers demand. Many workers, however, are unprepared for these new types of jobs. As a result, when a manufacturer shuts down a plant, for example, its workers are often unable to adjust to the types of positions that employers are currently looking to fill. Many believe that some workers are exiting the labor force because they are discouraged by the mismatch between their skills and the skills employers demand, and the low wages of the jobs they can obtain.

2. AFTER TAX POLICIES supplement market wages through the tax and transfer system. Expanding after-tax policies such as the Earned Income Tax Credit (EITC) would raise the return to work for low-wage workers and could increase participation.

3. EXPAND ACCESS TO PAID FAMILY LEAVE

   The United States is the only developed country in the world without a public policy for paid family leave.Yet, a federal policy that increases access to paid family leave could help increase labor force participation, primarily among prime-age women.Research shows that paid family leave in reasonable amounts can lead to higher employment rates. Workers with the benefit are much less likely to quit their jobs due to family reasons, ensuring greater job continuity and labor force attachment. These positive employment effects are particularly apparent for mothers.

4. REPEAL THE AFFORDABLE CARE ACT

   Evidence suggests that the Affordable Care Act (ACA) has caused labor force participation to decline significantly. With the ACA’s Medicaid expansion and premium subsidies, many low-income Americans no longer need to work in order to obtain health insurance. Moreover, these benefits impose an implicit high marginal tax on low-income individuals who would lose the benefit if they earn too much money. This is a bad combination as the ACA creates significant incentives to leave the labor force. Consequently, the CBO estimates that repealing the ACA would increase labor force participation by between 0.8 percent and 0.9 percent,which equals an additional 2 million full-time-equivalent workers. This increase would in turn increase economic output by 0.7 percent.

5. JOB TRAINING The people who are willing to work should be provided proper training of the job that they are require to do during the course of employment. This will help to increase the capability of the people which will help them to do their jobs much more efficiently.In this way the labourers will be much more skilled as they have been properly trained and have a certain experience in specific jobs.

6. SPREADING AWARENESS

   Aside from conversations, employers can spread awareness by providing resources to educate individuals about the culture of racism and the history of different races. Most individuals are unaware of racial injustice and the comments they unconsciously make towards their BIPOC (Black, Indigenous, and People of Color) colleagues.This will help to bring a change in the mentalities of people which will then help to reduce the racism discrimination in the work place and this will lead to an increased participation of the black peoples in the work space.