Economic security and opportunity for women under threat after U.S. Supreme Court takes anti-abortion stance in Texas

Posted on by Emilie Openchowski
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Nearly 1 in 4 women in the United States—whether single, married, living with a partner, or divorced—will have an abortion by the age of 45, and nearly 1 in 20 women will have an unintended pregnancy, according to research by the sexual and reproductive health organization the Guttmacher Institute. Reproductive healthcare is typically considered outside the realm of U.S. economic policy, but an intrinsic link between reproductive justice and economic opportunity exists, from the importance of contraception to access to abortion care for women’s careers and marriage decisions. Research by economists and other social scientists repeatedly demonstrates how this link between bodily autonomy and a person’s ability to decide when, how, and under what circumstances to plan for a family is critical to economic security and stability.

Specifically, research on the early broad-based dissemination of the birth control pill and on restrictions for abortion services, including gestational limits and targeted restrictions of abortion providers, or TRAP laws, finds that autonomy over family planning choices is directly linked to a woman’s job opportunities and financial security. This is why the U.S. Supreme Court’s stance last week to let stand a Texas law that effectively bans abortions after about 6 weeks of pregnancy—with its provision permitting any private citizen to sue anyone who “aids or abets” an abortion and be awarded at least $10,000 in turn—is an economic security threat to workers and their families in the state and, indeed, across the county.

The 5-4 Supreme Court decision to allow the Texas law, enacted on September 1, to stand despite it being targeted toward limiting abortion rights and access to abortion care in contravention of the constitutional right to access abortion under the landmark 1973 Roe v. Wade decision signals that a majority of the nine justices are willing to allow similar statutes to be enacted in other states. It also sets the stage for the now-widely anticipated overturning of that landmark decision by the Court, in a case out of Mississippi later this year.

U.S. policymakers in Washington and in statehouses around the nation should understand the economic implications of overturning Roe for women and their families, particularly among those struggling to maintain their financial stability and among women of color and their families. And even with Roe still technically allowing for the constitutional right to an abortion, state abortion restrictions have found ways to limit access to abortions for the most marginalized individuals, especially those who are low income and in communities of color.

Let’s review the economic research on family planning, starting with access to reproductive healthcare via contraception and its impact on economic security. Economists Claudia Goldin and Lawrence Katz at Harvard University, in a seminal working paper, find that “the pill had a direct positive effect on women’s career investment by almost eliminating the chance of becoming pregnant and thus the cost of having sex [and] also created a social multiplier effect by encouraging the delay of marriage generally and thus increasing a career woman’s likelihood of finding an appropriate mate after professional school.”

Greater participation in the U.S. labor force also was the result of “contraceptive freedom” for women, finds Martha Bailey, at the time of that research an economist at the University of Michigan and now a professor at the University of California, Los Angeles. The results of her research suggest that “legal access to the pill before age 21 significantly reduced the likelihood of a first birth before age 22, increased the number of women in the paid labor force, and raised the number of annual hours worked.” Additional research by Bailey, along with Brad Hershbein of the W.E. Upjohn Institute and Amalia Miller of the University of Virginia, finds that the increase in labor force participation gave women the opportunity to invest in new career paths and directly led to a reduction in the gender wage gap.

Contraception is one aspect of a person’s ability to engage in family planning. The availability of and access to abortion services is also a critical part of family planning and healthcare. During the same time period—from the mid-1960s to the early 1970s—that the birth control pill was broadly disseminated through the repeal of laws that limited access to it, abortion was legalized at the federal level with the Supreme Court ruling in Roe v. Wade in 1973.

Research by professor of economics Caitlin Knowles Myers at Middlebury College examines the relative impact of abortion access, alongside dissemination of the birth control pill, and finds that liberalized access to abortion had a significant impact on the ability of people to control family planning decisions in order to plan for their future careers and lives. As Myers notes, “even if legal access to the pill did not cause young women to delay marriage and motherhood, they may still have made human capital investments on the basis of incorrect beliefs about the efficacy of the pill, unaware of the wide gap between clinical and actual failure rates,” rendering access to abortion services a complementary and necessary aspect of reproductive autonomy.

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Understanding the link between bodily autonomy and economic opportunity across the United States

By Kate Bahn,

July 31, 2018

report

Gender wage inequality

By Sarah Jane Glynn,

April 9, 2018

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Equitable Growth’s history of focusing on women’s role in the economy: A review

By Equitable Growth,

March 19, 2019

These findings and other complementary research about women’s access to family planning as part of their reproductive healthcare highlight why laws in place in 22 states across the country to restrict access to legal abortion—including all-out bans, should the Supreme Court overturn the Roe decision—are dangerous to individuals and their families. These state statutes, if triggered into law by a U.S. Supreme Court decision in the forthcoming Dobbs v. Jackson Women’s Health Organization case out of Mississippi, would harm the economic security of women in these states and would severely limit future economic opportunities for them and their families.

Black women and their families may be particularly harmed by lack of access to abortion, according to evidence from a research paper by economists Joshua D. Angrist at Hebrew University and William N. Evans at the University of Maryland. They find that reforms to restrictive abortion laws following the national legalization of abortion in the early 1970s produced “modest” delays in pregnancies and marriage among White women and did not significantly affect their education or labor market outcomes, but Black women experienced significantly fewer teen pregnancies and nonmarital births, leading to “increased schooling and education rates.”

Women “trapped in bad jobs” is the widespread consequence of so-called TRAP laws, according to research by one of the authors of this column and Georgetown University public policy professor Adriana Kugler and economists Melissa Mahoney of the University of North Carolina, Asheville and Annie McGrew at the University of Massachusetts Amherst. This research finds that “Targeted Restrictions on Abortion Providers (TRAP) laws increased ‘job lock’ [and that] women in states with TRAP laws are less likely to move between occupations and into higher-paying occupations.” In contrast, they find that “public funding for medically necessary abortions increases full-time occupational mobility, and contraceptive insurance coverage increases transitions into paid employment.”

New research by economists Kelly M. Jones at American University and Mayra Pineda-Torres at Texas A&M University finds a similar asymmetrical pattern among White and Black women without access to abortions. Educational attainment and future family income are significantly limited for Black women in states with TRAP laws, compared to White women in these states. Indeed, while White women have the greatest absolute levels of abortion across the country, disproportionately more Black and Hispanic women seek abortion services, according to a recent research paper by economist Marshall H. Medoff at California State University, Long Beach. He also finds that Hispanic women are especially sensitive to whether there is Medicaid funding for abortion—34 states have this funding for low-income women for life endangerment, rape, and incest, and 16 have it for all medically necessary abortions.

All of this economic research demonstrates what’s at stake for individuals and their families in Texas today, likely soon in a handful of other states, and potentially across the country should the Supreme Court overturn Roe v. Wade.

Policymakers at the federal and state levels should recognize that economic security and opportunity are impacted by the ability of individuals to have autonomy over their family planning and on accessibility to comprehensive reproductive healthcare services.

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JOLTS Day Graphs: July 2021 Edition

Posted on by Raksha Kopparam

Every month the U.S. Bureau of Labor Statistics releases data on hiring, firing, and other labor market flows from the Job Openings and Labor Turnover Survey, better known as JOLTS. Today, the BLS released the latest data for July 2021. This report doesn’t get as much attention as the monthly Employment Situation Report, but it contains useful information about the state of the U.S. labor market. Below are a few key graphs using data from the report.

The quits rate remained relatively steady at 2.7 percent as 4 million workers quit their jobs in July, while the job openings rate increased to 6.9 percent.

Quits as a percent of total U.S. employment, 2001–2021

The vacancy yield declined in July as job openings reached a series high of 10.9 million while hires, at 6.7 million, were little changed.

U.S. total nonfarm hires per total nonfarm job openings, 2001–2021

The quits rate remained elevated in July, and increased in areas such as state and local government education, construction, and wholesale trade.

Quits by selected major U.S. industry, indexed to job openings in February 2020

The ratio of unemployed worker per job opening fell to below 0.8 in July, similar to the low levels previously seen immediately before the coronavirus recession.

U.S. unemployed workers per total nonfarm job opening, 2001–2021.

The Beveridge Curve continues to be in an atypical range, compared to previous business cycles, remaining elevated in July as the unemployment rate fell while the job openings rate increased.

The relationship between the U.S. unemployment rate and the job opening rate, 2001–2021

The coming public debt scare should not spook U.S. policymakers from investing in physical and social infrastructure

Posted on by Emilie Openchowski
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Public debt scaremongering is back in fashion on Capitol Hill. Republican legislators, from Senate Minority Leader Mitch McConnell (R-KY) on down, are invoking the high level of federal government debt—currently approaching 103 percent of Gross Domestic Product—as reason to oppose President Joe Biden’s proposed $3.5 trillion of new social infrastructure and investments in abating the effects of climate change.

Later this month, with the temporary COVID-related suspension of the federal debt limit lifted, the debate is about to acquire another flashpoint. Republicans are likely to insist that the debt ceiling should remain where it is to prevent the further accumulation of debt. They seem ready to go down this road despite understanding that, at some point, failure to raise the debt limit would prevent the government from paying its bills, with damaging economic consequences.   

This might be an acceptable price for politicians seeking to highlight their arguments that excessive debts damage the U.S. economy and burden future generations with high debt-service obligations. But these arguments are partial and incomplete.

In a new book, In Defense of Public Debt, my co-authors and I show how governments, through the ages, have resorted to issuing public debt to meet emergencies and address pressing social needs. The critics of higher public spending are right, of course, that additional debt requires higher taxes to fund interest payments, and that higher taxes are distortionary, meaning that they can be a drag on economic growth. But that doesn’t negate the need for higher public spending when conditions demand it. As my co-authors and I argue, expenditure restraints that limit the U.S. economy’s capacity to grow would be counterproductive from even the narrow standpoint of debt sustainability.

Sovereign debt had its origins in the recourse of sovereigns to debt issuance when it was necessary to raise armies and defend their kingdoms. That the U.S. ratio of debt-to-GDP reached its all-time high in World War II is a modern instance of the same phenomenon. But governments also resort to debt issuance to meet other emergencies, such as financial crises and pandemics, as we know from the experience of the past 15 years.

Sometimes there is disagreement about whether circumstances rise to the level of an emergency, as happened amid the twin housing and financial crises in 2008 and 2009, and whether the interventions made possible by debt issuance justify the costs. At other times, as in 2020, when the coronavirus pandemic threw the U.S. economy into a recession and public health emergency, the question answers itself.

Do our nation’s infrastructure problems rise to the level of a national emergency? Some answer yes, on the grounds that our physical infrastructure is old, dangerously vulnerable to climate change, and inadequately green and digital. A significant minority in the U.S. Senate insists otherwise, arguing that all additional infrastructure spending should be fully financed with new taxes and other savings. More infrastructure investment is desirable, they acknowledge, but it is insufficiently urgent to justify costly debt finance. That’s why we have these so-called pay-fors in the bipartisan Senate bill.

One way of adjudicating the dispute is to ask whether additional infrastructure investments will pay for themselves. At current interest rates, the U.S. Department of the Treasury will have to pay somewhat less than 2 percent on the roughly $250 billion the Congressional Budget Office says will be added to the national debt by the bipartisan physical infrastructure bill that passed the U.S. Senate in early August. (In other words, the CBO disputes that the pay-fors are actually all paid for.) For the investment to pay for itself, that infrastructure will have to yield an overall return of 8 percent, meaning a yield of 2 percent to the government, since federal revenues are roughly a quarter of GDP. 

Given that our infrastructure is old, outmoded, and dangerously vulnerable to climate change, the returns on investment are surely a multiple of this. The nonpartisan Congressional Budget Office doesn’t disagree.

And it gets better. We really should be comparing apples with apples—real returns with real returns. Currently, the real (inflation-adjusted) interest rate on new government debt is negative: Whereas the yield on 10-year Treasury bonds is less than 2 percent, inflation is more than 3 percent. In this situation, any investment that yields a positive real return is effectively self-financing.

What about the objection that the additional public investments will crowd out productive private investments? The way private investments get crowded out is through higher interest rates that render financing them prohibitively expensive. And there is no evidence yet of higher interest rates.

Which brings us to the proposed $3.5 trillion of additional spending on social infrastructure and abating the effects of climate change that is now under debate in Congress. Although supporters of the package insist that it will be fully financed by additional taxes on corporations and the wealthy, anyone who understands how U.S. politics works can safely assume that, just like the bipartisan infrastructure bill, only some of those taxes will survive congressional negotiation, and some fraction of the spending will be debt-financed.

Should we worry? No. The $3.5 trillion package contains some of the highest return on investments on the planet—much higher even than those on physical infrastructure. Such is the evidence on investments in care infrastructure such as early childhood education, day care, pediatric care, and child nutrition, which make for more productive, not to mention healthier and happier, adults. Similarly of access to community college: A year of community college pays for itself in as little as 7 or 8 years.

The same is again true of climate change abatement, where investments today will avert the need for much more expensive investments tomorrow. And because these are investments where social returns exceed private returns—where the benefits don’t accrue exclusively to individuals undertaking them—there’s a role for government in providing the finance.

Others, among them economist Larry Summers, worry that $500 billion of new infrastructure spending (the headline figure may be $1 trillion, but only half is new spending), together with $3.5 trillion of additional social infrastructure and climate-abatement spending, will overheat an economy that is only $500 billion smaller than it would have been absent the coronavirus pandemic and resulting recession. 

But this spending will be spread over 10 years, and maybe half will be financed with new taxes. So, we’re talking about $200 billion of additional deficit spending annually in an economy with $500 billion of spare capacity, assuming that the prewar growth trend is an accurate guide to the latter.

And even if the U.S. economy overheats, causing inflation to shoot up, this will actually be good for debt sustainability, not bad. Inflation will raise the denominator of the debt-to-GDP ratio. Higher nominal incomes were, of course, one of the ways our nation brought down its high debt-to-GDP ratio after World War II.

Equitable Recovery

The latest economic research demonstrates why concerns about federal budget deficits and U.S. debt levels are overblown

By Shaun Harrison,

April 1, 2021

Equitable Recovery

Factsheet: What does the research say about care infrastructure?

By Equitable Growth,

April 15, 2021

Equitable Recovery

A temporary increase in inflation is not a long-run threat to U.S. economic growth and prosperity

By Francesco D’Acunto, Michael Weber,

July 9, 2021

In fact, the worrisome scenario is that in which inflation remains low, not high, but in which interest rates rise. Higher real (inflation-adjusted) interest rates will make servicing the debt correspondingly more costly, requiring the application of additional distortionary taxes, thereby hampering growth. This would be an argument for going slow on even relatively high-return, debt-financed public investments.

But as noted, there is no sign of higher real interest rates yet. Indeed, real rates have been trending downward, not upward, for the better part of four decades—some would say not just for four decades, but also for four centuries. Real interest rates adjust to equalize savings and investment—not U.S. saving and investment, but global saving and investment.

Some economists point to the high savings of Germany, Saudi Arabia, and fast-growing emerging markets such as China to explain recent trends. Others suggest that real interest rates have fallen because the need for physical investment has declined with the shift from manufacturing to services and from physical platforms to digital platforms, and due also to the falling relative price of capital goods. Whatever the cause, the result has been to confront more saving supply with less investment demand and to depress the real interest rate.

Might this now change? The savings of oil-exporting economies could fall as demand for their petroleum dries up. Consumption in China could rise to levels more customary for a middle-income country as its government builds out its own social infrastructure to cope with an aging population. Such changes are coming. But history tells us that developments such as these are slow-moving. It’s implausible that they will cause real interest rates to shoot up between today and tomorrow or between this year and the next.

Ultimately, the day will come when the United States will need to take proactive steps to stabilize the debt-to-GDP ratio and prevent rising debt-service costs from launching the debt ratio on an explosive path. At this point, fiscal consolidation will require a combination of higher taxes and expenditure restraint. 

As noted above, expenditure restraints that limit the U.S. economy’s capacity to grow would be counterproductive from even the narrow standpoint of debt sustainability, since these would depress the denominator of the debt-to-GDP ratio. In other words, expenditure restraint, when the time comes, should not fall on the high-return investment projects discussed above.

International experience with the structural adjustment programs of the International Monetary Fund tells us that governments, when compelled to cut spending, find it easier politically to cut public investment than public consumption. That experience, in places as diverse as Latin America and Greece, also indicates that spending cuts that disproportionately impact the poor are likely to be unsustainable politically—they provoke a political backlash that defeats the adjustment effort. 

This is one reason why the IMF, having seen earlier adjustment programs fail, now talks about the importance of pro-poor adjustment and equitable, inclusive growth. Eventually, the time will come for U.S. policymakers to take this same lesson to heart.

—Barry Eichengreen is the George C. Pardee and Helen N. Pardee professor of economics and political science at the University of California, Berkeley, and the co-author, along with Asmaa El-Ganainy at the International Monetary Fund, Rui Esteves at the Graduate Institute of International and Development Studies, and Kris James Mitchener at Santa Clara University, of In Defense of Public Debt (September 2021: Oxford University Press).

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Weekend reading: Announcing Equitable Growth’s 2021 research grants edition

Posted on by Emilie Openchowski

This is a post we publish each Friday with links to articles that touch on economic inequality and growth. The first section is a round-up of what Equitable Growth published this week and the second is relevant and interesting articles we’re highlighting from elsewhere. We won’t be the first to share these articles, but we hope by taking a look back at the whole week, we can put them in context.

Equitable Growth round-up

Earlier this week, Equitable Growth announced a record $1,392,795 in research grants for scholars examining the various channels through which inequality impacts economic growth and stability. The 62 researchers, including faculty members, postdoctoral students, and Ph.D. candidates at U.S. colleges and universities, make up the largest-ever cohort of Equitable Growth annual academic and doctoral grantees. Equitable Growth grants fall into four overarching categories, and this year’s awards emphasize our commitment to funding cutting-edge research that addresses pressing policy concerns, including studying the roots and effects of systemic racism, mitigating the impact of climate change, and making child care more accessible in the United States. The findings from these projects will likely inform the policy debate in the months and years to come. Learn more about all the research we funded through the 2021 grant cycle.

This Labor Day, Equitable Growth’s Kate Bahn and Carmen Sanchez Cumming look at the impact of unions on interracial solidarity. Unions promote labor standards enforcement, increase wages for all workers (unionized or not), and reduce inequality. And a new paper finds that union also temper racial resentment and boost support for public policies that benefit Black workers, families, and communities more broadly. Bahn and Sanchez Cumming detail the research paper’s findings that White union member attitudes become more favorable toward policies such as affirmative action or programs designed to improve social and economic circumstances of Black communities, compared to White nonunion members. They also explain how unions influence political views and attitudes toward race, and the complicated history of unions and racism.

There are many inequities in access to adequate transportation in the United States, constraining the economy, harming the well-being of individuals, and perpetuating racial disparities. In order to properly measure and track the prevalence of transportation insecurity—a term coined by Alix Gould-Werth, Alexandra Murphy, and Jamie Griffin of the University of Michigan to describe the condition of being unable to regularly move from place to place in a safe or timely manner—the co-authors developed a Transportation Security Index. This index also can help measure the racial inequities in transportation insecurity, allowing policymakers and government agencies to target and deliver services more efficiently to ameliorate these inequities. In a column, Gould-Werth and Murphy explain how the index is calculated and why it is more accurate than most current tools used to measure transportation equity.

Congress is currently debating how to proceed with President Joe Biden’s Build Back Better agenda, two infrastructure packages designed to bolster U.S. physical and social infrastructure. David Mitchell dives into comparisons between President Biden’s plans and President Franklin D. Roosevelt’s New Deal agenda from the 1930s. Mitchell details the shortcomings of the New Deal—namely its carve-outs that denied benefits for domestic service workers, who were mostly women and people of color—and reviews how President Biden is attempting to right these wrongs, as well as center climate change mitigation, in his 2021 agenda.

The U.S. Bureau of Labor Statistics released data on employment and the U.S. labor force in August today, revealing a telling slowdown in the job market recovery as COVID-19 infections rise. Carmen Sanchez Cumming, Kate Bahn, and Kathryn Zickuhr detail the implications, particularly for public school teachers. While public education employment has been strong in recent months, many school districts face a teacher shortage as educators are struggling against coronavirus outbreaks, shifting public health guidelines, and contentious debates over mask mandates for school children. These newer challenges, the co-authors explain, have arisen in addition to longstanding issues in the sector such as low pay, lack of administrative support, and high stress at work—all of which have widespread consequences and costs, which are higher for women and people of color.

Links from around the web

Emergency unemployment benefits are set to expire at the beginning of next week. But, writes NPR’s Scott Horsley, this doesn’t mean the millions of U.S. workers who have accessed this vital income support will immediately return to work. The data from states that ended the extended Unemployment Insurance program early show that cutting off these benefits did not lead to a surge in employment. And with the delta variant of the coronavirus wreaking havoc on the recovery, allowing this program to expire will likely increase poverty rates and reduce spending across the economy. Horsley interviews two workers who will experience cuts about how they expect the change in policy to affect their well-being.

The staggeringly high levels of wealth inequality in the United States have disproportionately negative effects on children of color, and in particular on Black and Hispanic children, reports The Guardian’s Ed Pilkington. In fact, he continues, new research shows that Black families with children have access to barely 1 cent for every dollar their White counterparts have. These findings have implications for the recently expanded Child Tax Credit, which would go a long way to lifting many U.S. children out of poverty but which is temporary and will expire at the end of this year. Pilkington then details how racial wealth inequality perpetuates a cycle in which the divides in wealth and income between White households and households of color increasingly grow wider and are passed on to future generations.

U.S. workers are increasingly taking gig economy jobs, with 1 in 3 employees accepting positions that don’t come with employer-provided benefits such as health care or paid time off. Recode’s Rani Molla dives into the implications of this finding, particularly as relates to inequality. Gig work tends to exacerbate unequal outcomes because it shifts the risks from employers to employees and can lead to financial instability for workers, alongside higher levels of stress. Gig economy employees also tend to not have workplace protections such as minimum wages or overtime pay, or access to income support programs or paid parental leave. Even so, Molla writes, growth in gig employment has outpaced growth in wage employment and has risen particularly high since the coronavirus pandemic began, probably because workers compensate for or buffer income shocks as a result of being laid off or working fewer hours. Molla goes into further detail about why workers are turning to gig work now, as well as how these workers can be better protected.

Friday figure

U.S. unemployment rate by race, 2019–2021

Figure is from Equitable Growth’s “August Jobs Report: Uncertainty and teacher shortages loom over the new school year” by Kate Bahn, Carmen Sanchez Cumming, and Kathryn Zickuhr.

August Jobs Report: Uncertainty and teacher shortages loom over the new school year

Posted on by Emilie Openchowski
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There was a telling slowdown in the recovery of U.S. jobs in August, according to the most recent Employment Situation Release by the U.S. Bureau of Labor Statistics today. Amid climbing COVID-19 infections in many states, the U.S. economy added only 235,000 jobs between mid-July and mid-August—significantly less than expected and well below the 876,000 average job gains over the previous 3 months.

The overall U.S. labor force participation rate was unchanged from July to August, remaining at 61.7 percent after little improvement over the past year. The prime-age employment-to-population ratio—a measure that captures the share of adults ages 25 to 54 who are employed—did show an increase, rising from 77.8 percent in July to 78 percent in August, though it is still 2.4 percentage points below its pre-pandemic level in February 2020.

Despite this slowing pace of jobs recovery this past month, the bounce back in employment remains far speedier after the coronavirus recession than after the Great Recession of 2007–2009. (See Figure 1.)

Figure 1

Percent of employment losses relative to peak employment

Disaggregating the most recent jobs numbers by race and ethnicity provides a more complete picture of the current jobs recovery. The unemployment rate for Black workers—which continues to be higher than for any other major racial or demographic group—rose from 8.2 percent in July to 8.8 percent in August and is 2.8 percentage points above its pre-pandemic level. Latinx workers are experiencing an unemployment rate of 6.4 percent, 2 points above its pre-pandemic level. The unemployment rate for Asian American workers in August fell to 4.6 percent and for White workers fell to 4.5 percent, compared to July rates of 5.3 percent and 4.8 percent, respectively, and pre-pandemic lows of 2.4 percent and 3 percent in February 2020. (See Figure 2.)

Figure 2

U.S. unemployment rate by race, 2019–2021

Recent trends in employment growth reversed in August. Across sectors, the leisure and hospitality industry and the government sector experienced the biggest net increases in employment over the 3 months from May to June, adding 1.1 million jobs and 438,000 jobs, respectively, but leisure and hospitality experienced no growth and government employment actually declined by 8,000 in August. For the government sector, there was a 26,400 decline in state and local education jobs—a decline that was partially offset by local government hiring, excluding education. (See Figure 3.)

Figure 3

Net change in U.S. government employment (in thousands), by subsector, July 2021-August 2021

A snapshot of public education employment patterns before and amid the pandemic

Even before the decline in public education (local and state education are down 406,000 jobs and private education is down 159,000 jobs since February 2020, though private education added 40,000 jobs in August), school districts across the country reported facing a teacher shortage as they head into a new academic year. They also are struggling with COVID-19 outbreaks, shifting public health guidelines, and contentious debates over both mask and vaccine mandates.

For school teachers, the continuing coronavirus makes an already-demanding job even more stressful. A recent survey by the RAND Corporation, for example, finds that in pre-pandemic years, on average, 1 in 6 teachers reported that they were likely to leave their job by the end of the school cycle. But in the 2020–2021 school year, almost 1 in 4 teachers said they were likely to leave their jobs. And another report found that 44 percent of the public school teachers who voluntarily stopped teaching after March 2020 did so because of the pandemic.

Clearly, fears of getting or spreading COVID-19 and the challenges of navigating an unprecedented teaching environment added on to the tough working conditions that teachers were struggling with well before the health and economic crises hit the United States in February of last year. Indeed, over the past 10 years, demand for teachers has been greater than supply, leading to a growing teacher shortage that has only been exacerbated by pandemic-related hiring slowdowns, layoffs, and resignations.

Relatively low pay, stress at work, and lack of administrative support are some of the main reasons why schools have long struggled to hire and retain teachers. Research by Sylvia Allegretto at the University of California, Berkeley and Larry Mishel at the Economic Policy Institute finds, for instance, that in 1996, public school teachers were paid 6 percent less than other workers with similar levels of education and years of work experience, among other characteristics associated with productivity, yet by 2019, this pay penalty had grown to 20 percent.

Insufficient compensation hurts the workers who do the job, their students, and the public school system writ-large. Low pay increases moonlighting, where teachers have to work a second job to make ends meet, which further limits education quality that can be provided by teachers stretched too thin. Similarly, research shows that teacher quality is affected by their low wages in the presence of outside options. Put another way, would-be high-quality teachers may choose other professions if there are better opportunities elsewhere.

The race and gender costs and consequences of inadequate public education pay

As in-person schooling remains contentious and risky, combined with these preexisting trends, the teacher shortage crisis continues to pose a risk to education quality across the United States. One study shows, for example, that the most qualified teachers—those who are fully certified, have more years of experience, and have a background in the subject they are teaching—are less likely to work in high-poverty schools. Labor conditions, teacher preparation, and public funding are all closely intertwined, which is one reason why progressive funding for education has the potential to reduce economic inequality.

Because teaching remains a heavily women-dominated profession and women continue to do the lion’s share of the unpaid work of caring for their families and communities, the added pressure the coronavirus crisis has put on women workers limits potential job gains after women led job growth in recent months following steep losses earlier in the pandemic. The teacher workforce is predominately made up of White women, and the pandemic could exacerbate existing pressures that drive Black teachers out of the profession.

Indeed, according to the RAND report, “nearly half of teachers who identified as Black or African American reported that they were likely to leave their jobs by the end of the school year and were more likely to say that they planned to leave than were teachers of other races.” Across industries, Black and Latinx women have seen the highest job losses during the pandemic and have been most likely to leave the U.S. labor force entirely.

Officially, the economic recession triggered by the coronavirus pandemic only lasted 2 months, between February and April of last year. Yet millions of workers and families continue to struggle. The U.S. economy is currently at a 5.3 million job deficit, compared with February 2020, and more than 8.4 million people looking for a job do not have one.

Moreover, the huge strides in the jobs recovery will be moderated by the degree to which high-quality jobs, especially jobs that do not put workers at risk in a pandemic, are available to workers, and by the number of workers willing and able to return to front-line jobs amid the recent sharp spike in infections. Then, there’s the degree to which families are supported in managing the continued threat of coronavirus through policies such as accessible child care and Unemployment Insurance benefits.

Across all of these jobs market dynamics, one pattern is clear: The pandemic is highlighting the role worker voice can play in keeping students, workers, and communities safe. Even as teacher unions have not uniformly supported vaccine mandates, 90 percent of the National Education Association’s members—the largest teacher union in the country—are vaccinated. A team of researchers studying how unions influence the adoption of public health guidance found that Iowa school districts where a greater share of teachers were unionized were more likely to adopt mask mandates last year. Schools that required teachers and staff to wear masks, the authors note, had 37 percent fewer COVID-19 cases than schools that did not implement the mandates.

Teachers have gone to massive lengths to both teach during the pandemic and ensure schools are safe, yet they are often not supported in the same way if they are exposed to the coronavirus at work. Last year, teachers—along with other eligible workers—could receive up to 2 weeks of emergency paid sick leave through the Families First Coronavirus Response Act. But employers were only required to provide these benefits until the provision expired at the end of 2020, and few school districts made the decision to extend this leave until March 2021 or access the renewed, voluntary round of federally funded leave that is currently set to expire at the end of September. As a result, in some districts, teachers have to use their own sick leave if instructed to quarantine by their schools.

To ensure all primary and secondary schools can eventually reopen and the labor market recovery gets back on track, all public school teachers and other school staff need to be able to access the supports and economic security needed to navigate the ongoing pandemic.

Posted in Uncategorized

Equitable Growth’s Jobs Day Graphs: August 2021 Report Edition

Posted on by Carmen Sanchezcumming

On September 3, the U.S. Bureau of Labor Statistics released new data on the U.S. labor market during the month of August. Below are five graphs compiled by Equitable Growth staff highlighting important trends in the data.

The prime-age employment rate for prime-age workers increased slightly in August from 77.8 percent to 78.0 percent, but remains below pre-recession levels. 

Share of 25-54 year olds who are employed, 2007–2021

The unemployment rate declined for White workers (4.5 percent) but did not change notably for Black workers (8.8 percent), the highest group, or for Latinx workers (6.4 percent) or Asian workers (4.6 percent).

U.S. unemployment rate by race, 2019–2021

The prime-age employment rate for both men and women rose in August, though neither rate has approached its level from immediately before the coronavirus recession. 

Share of the U.S. population that is employed, by gender, 2007–2021

Top-line unemployment, also known as U-3, and a broader measure of labor underutilization, known as U-6, declined in August, as both overall unemployment and underemployment trended downward.  

U-3 and U-6 unemployment rates, 2000–2021

The share of unemployed workers who reentered the labor force continued to rise in August, while the share of those who lost their jobs declined. Employment is still elevated relative to pre-coronavirus recession levels.

Percent of all unemployed workers in the United States by reason for unemployment, 2019–2021

Posted in Uncategorized

The ‘Transportation Security Index’ can help the United States plan for a more equitable transportation future

Posted on by Emilie Openchowski
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On his first day in office, President Joe Biden signed an executive order titled “Advancing Racial Equity and Support for Underserved Communities Through the Federal Government.” Recognizing that the federal government can’t determine whether meaningful progress is being achieved if progress is not measured, the order requires agencies to work with the Office of Management and Budget to identify research methods and metrics that will best equip each government agency to assess equity in the issues in their purview. Accordingly, the U.S. Department of Transportation issued a request for information on transportation equity data, to which we responded, encouraging them to adopt our Transportation Security Index in future planning.

Inequities in access to adequate transportation are deep-seated in the United States, and these inequities constrain the U.S. economy from functioning at its full potential, harm the well-being of individuals, and perpetuate racial disparities. In the United States, the car is the dominant form of transit, yet cars are expensive to own and maintain. The adequacy of public transit infrastructure—and even its very presence—varies by geographic location. And the ability to use walking or biking as an effective mode of transportation varies depending on both an individual person’s health condition and their “built environment” (urban planning parlance for the human-made surroundings in which people live, work, and move about).

Together, we have developed the term “transportation insecurity” to describe the condition of being unable to regularly move from place to place in a safe or timely manner because of a lack of resources necessary for transportation, which we advance in an article authored by the two of us and Jamie Griffin at the University of Michigan. Large segments of the U.S. population experience transportation insecurity. This condition cuts people off from the labor market and opportunities to develop their human capital by attending school or accessing social services. When large numbers of people are transportation insecure, it prevents the government from effectively funneling resources to people to increase their consumption and stabilize the macroeconomy during economic downturns.

Despite the importance of this issue, no government agency tracks the prevalence of transportation insecurity or racial inequities in how it is experienced. Furthermore, there is a dearth of rigorous evaluations of how changes to U.S. transportation infrastructure affect the scale and distribution of this condition. This paucity of information is at least partially explained by an absence of adequate measurement tools.

When policymakers and urban planners try to measure transportation equity, which is rare today, they use metrics that measure neighborhood accessibility by examining characteristics of a locality, such as walkability scores, commute times, proportion of the population owning cars, and proximity to public transit. But these infrequently used metrics tell us little about whether individuals experience transportation insecurity. Two neighbors, for example, would be evaluated as experiencing the same level of neighborhood accessibility even if one had access to a reliable car and could use public transit while the other lacked a vehicle and could not use public transit because of a disability.

Currently used individual-level measures also suffer from serious weaknesses. Scholars of poverty and inequality typically rely on a dichotomous measure of car ownership—does the household have a car or not?—to assess the adequacy of a person’s transportation situation. This is an imprecise measure because many people who experience transportation insecurity have access to a vehicle but cannot afford the gas, insurance, or cost of car repairs. And some transportation-secure people do not have access to a vehicle but can meet their transportation needs through public transit or bicycling.

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The imperative of focusing on racial equity in U.S. economic statistics

By Shaun Harrison,

June 11, 2021

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Toward a unified measure of U.S. housing insecurity

By Robynn Cox,

July 11, 2017

Boosting Wages

Place-conscious federal policies to reduce regional economic disparities in the United States

By Robert Manduca,

January 14, 2021

To encourage the U.S. Department of Transportation to use an improved individual-level measure of transportation insecurity to gauge the extent of disparities in transportation insecurity and to evaluate attempts to ameliorate these inequities, we submitted a comment to the department that describes the Transportation Security Index. The Transportation Security Index is modeled after the Food Security Index, informed by 187 in-depth interviews with people across the transportation insecurity spectrum, and has now been validated using a nationally representative survey.

The index is composed of items that ask respondents about symptoms of transportation insecurity (for example, taking a long time to plan out everyday trips, feeling stuck at home, or worrying about burdening others with requests for assistance with transportation) and can be used to assign each respondent a transportation insecurity score that ranges from 0 (most secure) to 32 (most insecure).

By focusing on the experiences associated with transportation insecurity, this measure spares researchers from attempting the impossible task of cataloging every possible input—from bus schedules to gas prices to sidewalk presence—that could affect one’s level of transportation security. And by offering simple-to-administer survey questions, this measure allows policymakers, planners, and researchers to document the prevalence of transportation insecurity, measure racial disparities in who experiences it, and assess interventions that attempt to mitigate the condition.

In this way, the Transportation Security Index can be used to measure the extent to which transportation policy is exacerbating or ameliorating existing transportation inequities.

This is an important moment for transportation in the United States. The U.S. Congress is closing in on a bipartisan physical infrastructure deal. While some transportation advocates argue that the deal could do more to invest in alternatives to auto-based transit, it takes the important step of recognizing transportation’s fundamental power to connect people to goods and services and authorizing a pilot program measure of access to essential goods and services. It’s time to get serious and start advancing real equity measures to understand the depth of racial disparities in access to adequate transportation and how to eliminate transportation insecurity across the U.S. population to improve individual well-being and strengthen the broader U.S. economy.

The Transportation Security Index is a useful tool that can be used to determine whether people can get to where they need to go in a safe or timely manner and evaluate interventions that are designed to strengthen our economy by moving people from a state of transportation insecurity to one of security. As a first step, the U.S. Department of Transportation—potentially in collaboration with the research arm of the U.S. Department of Health and Human Services’ Administration for Children and Families, which has expertise in measures of material hardship—should begin collecting the data necessary to measure the prevalence of transportation insecurity and disaggregate the analyses by geographic unit and demographic group.

The Department of Transportation could further consider using transportation insecurity in its criteria for entry into competitive programs or using this information to ensure that programs it funds are in compliance with Title VI of the Civil Rights Act of 1964—the landmark law that prohibits discrimination in the United States due to “race, color, or national origin.”

In short, it is only by measuring the prevalence of transportation insecurity that policymakers can begin to solve the problem of transportation inequity.

—Alix Gould-Werth is the director of family economic security policy at the Washington Center for Equitable Growth. Alexandra K. Murphy is an assistant professor of sociology at the University of Michigan and a faculty affiliate at the university’s Population Studies Center at the Institute for Social Research.

Posted in Uncategorized

Labor Day: How unions promote racial solidarity in the United States

Posted on by Emilie Openchowski
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Research consistently demonstrates that unions across the United States promote the enforcement of labor protections, increase pay for both union and nonunion members, and reduce income inequality. Importantly, labor organizations also help to institutionalize norms of fairness and equity and narrow pay divides along the lines of race and gender.

Amid this year’s Labor Day celebrations, a closer look is warranted at how unions can promote interracial solidarity. One telling outcome is that unionization also reduces racial animus among union members and highlights why increasing the bargaining power of all U.S. workers is key to creating a more equitable economy and a society better equipped to deal with institutional racism at work and in our communities.

In a 2021 paper, Paul Frymer at Princeton University and Jacob Grumbach at the University of Washington propose that in addition to upholding labor standards, boosting wages, and putting the brakes on economic inequality, unions temper racial resentment and foster support for public policies that benefit Black workers, families, and communities.

In their study, Frymer and Grumbach examine the relationship between falling union membership and rising White identity politics. The two political scientists develop a theory in which unions promote support for racial inclusion and equality by influencing the attitudes of their White members.

Indeed, the authors find that union membership not only reduces racial resentment but also results in White unionized workers becoming more likely to support affirmative action and government efforts to improve the social and economic standing of the Black community, compared to their nonunionized counterparts. As such, the steady decline in union membership rates since the late 1950s reflects the weakening of an institution that improves workers’ labor market outcomes and fosters support for civil rights and a stable democracy through its effect on White workers’ attitudes toward race.     

An array of complementary research supports their conclusions.

How unions influence political views and attitudes toward race

The power of unions has declined since the height of the labor movement in the mid-20th century, yet unions continue to play an important role both in promoting redistributive policies and in influencing the political views of their members. For one, labor unions are some of the largest civic organizations in the United States and currently represent 14.3 million workers—almost 11 percent of all U.S. wage and salary workers.

Moreover, as sites of democratic deliberation, political mobilization, and information sharing, unions can influence the policy landscape. Research finds, for example, that states with stronger unions tend to have more progressive tax codes and to spend more on public education and on their income support infrastructure.

In the case of attitudes toward race, over the past few decades, unions have had increasing ideological and strategic interests in fostering interracial solidarity. Bruce Western at Columbia University and Jake Rosenfeld at Washington University in Saint Louis call unions “pillars of the moral economy in modern labor markets.” As such, organized labor can be an important advocate for racial egalitarianism by promoting norms of equity, social solidarity, and advancing the interests of low-wage workers both inside and outside the workplace.

In addition, the U.S. labor movement has become more diverse in terms of its racial, ethnic, and gender composition at least since the early 1980s. This means union leaders have incentives to be inclusive of—and responsive to—the interests of workers of color in order to grow their organizations, secure union election victories, and successfully negotiate collective bargaining agreements.

Frymer and Grumbach primarily use two strategies to examine the relationship between union membership and racial resentment. Using data from the Cooperative Congressional Election Study’s Common Content—which is conducted twice a year during election years and contains a sample of about 30,000 respondents—they analyze differences in attitudes toward race. They find that among otherwise-similar White workers—that is, accounting for factors such as age, level of educational attainment, income, and gender—those who are unionized are less racially resentful and report greater support for affirmative action than those who are not.

To further tease out whether unions have an effect on racial attitudes or whether White workers who are more likely to value racial equity self-select into unions, the authors use data from the Voter Study Group—which surveyed the same 8,000 respondents during the 2012 election cycle and then again during the 2016 election cycle—to follow the evolution of their racial attitudes over time. Consistent with the former findings, the authors find that becoming a union member substantially reduced racial animus among White workers.

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Factsheet: How strong unions can restore workers’ bargaining power

By Equitable Growth,

May 1, 2020

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How combating voter suppression can help close the economic divides between Black and White Americans and spur U.S. economic growth

By David S. Mitchell, Austin Clemens, Shanteal Lake,

February 3, 2021

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Schooled by strikes: How strikes shape workers’ views about the U.S. labor movement

By Alexander Hertel-Fernandez, Kate Bahn,

October 29, 2019

In addition, they find that union membership is also associated with greater support for government action that advances the social and economic position of the Black community and promotes fair treatment when it comes to hiring.  

Labor unions have a complicated history of both racism and racial solidarity

The history of the labor movement is certainly not without instances of systemic racism. In the late 19th and early 20th centuries, Frymer and Grumbach note, unions regularly engaged in discriminatory practices, pushed back against integration, and even mobilized in support of the Chinese Exclusion Act of 1882—a restrictive and racist policy which suspended the immigration of Chinese workers and was the first law in U.S. history to ban a group of people on the basis of their race or nationality. Even when not outright segregationist, unions—and craft unions in particular—could be hostile to the enforcement of anti-discrimination measures.  

Union leaders have made alliances with civil rights organizations since the advent of the New Deal in the 1930s, and many labor organizations have been proactive in fostering racial equity and advancing the economic standing of Black workers during the Civil Rights era and since then. But others continued to engage in discriminatory practices, were reluctant to integrate, crowded Black workers into lower-paying jobs, and pushed back against affirmative action policies even in the post-Civil Rights era of the late 1960s and 1970s up to today.  

As such, Frymer and Grumbach point out that their “theory is contextually and institutionally bounded.” In other words, the observed negative relationship between union membership and racial resentment needs to be understood as specific to the current context—one in which labor unions have egalitarian convictions and strategic incentives to foster interracial solidarity. Likewise, the implications of these findings are especially important in the context of the rising nationalism and racism many nations are facing today.

A strong labor movement today can promote social well-being and broadly shared economic growth

Unions not only play an important role in improving the labor market outcomes of their members and serve as a mechanism to help achieve a more dynamic and inclusive economy, but also act as a buffer against White identity politics. A strong labor movement today can therefore push back against racism and longstanding trends of rising income inequality—both of which can be deeply destabilizing for an interracial democracy. While the authors do not test this hypothesis empirically, they argue that the same mechanisms that temper racial resentment toward the Black community are also likely to reduce White union members’ resentment against immigrants and other marginalized groups.

In finding that union membership reduces racial resentment, Frymer and Grumbach’s research highlights one of the most compelling benefits of promoting workers’ bargaining power, as well as the importance of making it easier for more workers to join and form unions through policies such as the Protecting Right to Organize, or PRO, Act. Research demonstrates that bargaining power is a critical component of reducing income inequality and ensuring that U.S. workers receive income equal to the value they create. In this way, worker power actually helps achieve efficient outcomes like those that would exist in a dynamic and competitive economy.

Black workers tend to face persistent wage disparities, and those lower earnings reflect centuries of structural racism. That’s why exercising power at work is core to being paid fairly. Giving workers more tools to exercise their voice at work, promoting policies and political attitudes that advance racial equality, and balancing power in the U.S. labor market would ensure that the economic growth is more broadly shared.

Posted in Uncategorized

Completing the unfinished New Deal to overcome 21st century U.S. economic inequality

Posted on by Maria Monroe
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President Joe Biden wants Congress to enact his two signature legislative packages—the $1 trillion bipartisan physical infrastructure plan passed by the U.S. Senate earlier in August and a $3.5 trillion social infrastructure package currently being crafted by Democratic congressional leaders. President Biden argues that these investments are needed to ensure the U.S. economy “builds back better” as it recovers from the coronavirus recession.

But even President Biden’s “big” rhetoric doesn’t fully capture the scope of his policy ambitions. He wants nothing less than to complete the unfinished business of President Franklin D. Roosevelt’s 1930s-era New Deal, once again rejecting fiscal austerity while correcting for racist carve-outs, filling in the holes in our social and care infrastructure, and investing to abate the increasingly dire consequences of climate change. And he wants to demonstrate that the federal government—and the democratic processes undergirding it—can deliver for everyday workers and their families in the United States.

Congress too has embraced this “unfinished New Deal” rhetoric, even going so far as to establish a Select Committee in the House of Representatives explicitly modeled on the FDR-era Temporary National Economic Committee, which was launched in 1938 to study the deleterious effects of overly concentrated economic power. The new House Select Committee on Economic Disparity and Fairness in Growth, chaired by Rep. Jim Himes (D-CT), promises to “develop solutions to the key economic issue of our time: the yawning prosperity gap between wealthy Americans and everyone else.”

Of course, the government programs that were first set up by the New Deal nearly a century ago—the Social Security Act turned 86 earlier this month—need a thorough update to address today’s different economic challenges and help the types of workers who were left behind by President Roosevelt.

Take, for example, infrastructure investment. The ringing success of the Tennessee Valley Authority—designed explicitly to bring electricity and economic development to one of the nation’s poorest regions of the early 20th century—baked into our policymaking the idea that the federal government has a wide-ranging obligation to provide for the overall public good through large investments in infrastructure. This is likely one reason why the physical infrastructure bill, which includes $550 billion in new investments in transportation, water systems, broadband networks, and electricity grids, won bipartisan support in the Senate. Unlike during the New Deal, though, these investments are, in many cases, specifically designed to provide Black, Latinx, and Indigenous communities with affordable transportation to jobs, safe drinking water, and reliable broadband access, addressing our country’s continuing racial inequities.

Similarly, President Biden’s proposals include investments in a range of job-creating projects to mitigate the effects of climate change, harkening back to President Roosevelt’s commitment to provide good-paying jobs to the many unemployed men laid low by the Great Depression. Today, of course, many U.S. industrial workers—men and women alike—are struggling in our post-industrial economy.

One group that President Roosevelt’s programs left out, though, were domestic service workers, mostly women and especially women of color. They were denied the benefits of the New Deal because of the opposition of racist politicians in the president’s Democratic congressional coalition and due to societal expectations at the time that men were the appropriate sole breadwinners for families. President Biden’s Build Back Better plans attempt to counteract these explicitly racist and sexist New Deal shortcomings by recognizing the role of women in the workforce and in caregiving, especially women of color, and investing accordingly.

Equitable Recovery

Factsheet: What does the research say about care infrastructure?

By Equitable Growth,

April 15, 2021

Equitable Recovery

Weak income support infrastructure harms U.S. workers and their families and constrains economic growth

By Liz Hipple, Alix Gould-Werth,

August 5, 2021

Equitable Recovery

The coronavirus recession and economic inequality: A roadmap to recovery and long-term structural change

By Heather Boushey, Somin Park,

April 16, 2020

The initial physical infrastructure plan, for example, included investments in long-term care services and long-term care workers, a large majority of whom are underpaid women of color. Those provisions were dropped by the Senate, but there is still a chance that the authors of the social infrastructure package take up the fight and begin to right those New Deal wrongs.

The social infrastructure package also could include a multibillion-dollar investment in child care—an investment that research demonstrates can boost parents’ labor force participation. That’s also why President Biden’s concomitant call for investment in universal pre-Kindergarten would, as academic research shows, create good-paying jobs and boost women’s labor force participation. 

But President Biden, like President Roosevelt before him, sees these multitrillion-dollar investments over the remainder of this decade as far more than the sum of their parts. Back in the 1920s and 1930s, the United States faced political challenges from right-wing populists and fascist demagogues at home and abroad who sought nondemocratic means to “fix” the deep and severe economic problems of that era. FDR saw in his New Deal programs the means to respond to these challenges by having the federal government invest directly and sweepingly in the U.S. economy to demonstrate the superiority of progressive democratic values.

It worked, of course, helping to cement the 20th century as the “American Century.”  

Fast forward to 2021. President Biden’s pitch is all about creating the economic and social conditions under which Americans of all races, ethnicities, and genders can prosper. This, in turn, could well turn back the dangerous and demagogic anti-democratic trends in our nation and shine a light anew on why completing the unfinished business of the New Deal to meet the challenges of a 21st century economy will ensure this century, too, remains an American Century.

Equitable Growth announces record $1.39 million in research grants for scholars examining economic inequality and growth

Posted on by Maria Monroe
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The Washington Center for Equitable Growth today announced its 2021 research grants, with funding of $1,392,795—a record-breaking level—awarded to 62 researchers. These scholars are studying the various channels through which economic inequality, in all its forms, impacts economic growth and stability.

For the past 8 years, Equitable Growth has funded economists and social scientists in various stages of their careers, including faculty members, postdoctoral students, and Ph.D. candidates at U.S. colleges and universities. This year’s cohort of scholars makes up the largest group of annual grantees in Equitable Growth history, with 48 academic and 14 doctoral grantees.

“The advances from every research grant will be invaluable to broadening our knowledge of the challenges and opportunities present in the U.S. economy for today’s workers and families, across race, ethnicity, gender, and class,” said Equitable Growth’s incoming President and CEO Michelle Holder in a press release announcing the grants.

Equitable Growth grants fall into four overarching categories: human capital and well-being, the labor market, macroeconomics and inequality, and market structure. The awards emphasize Equitable Growth’s commitment to funding cutting-edge research that addresses pressing policy concerns and will inform the policy debate in the months and years to come.

Equitable Growth’s 2021 Request for Proposals highlighted the importance of dimensions and intersections of inequality, particularly along the lines of race and ethnicity, in recognition of the fact that research on the consequences of structural racism is essential to understanding and identifying the drivers of U.S. income and wealth inequality, and how these inequalities are a drag on growth. Several funded projects will examine a number of issues related to structural racism and racial inequality, and also offer potential policy solutions.

  • Yao Lu will examine the source of racial and ethnic inequality among the highly educated workforce in the United States by looking at how educational credentials translate into labor market outcomes. She will look at which dimensions of mismatches in the labor market and which processes of the employment relationship drive racial and ethnic inequality.
  • Christopher Wimer, Zachary Parolin, and Ronald Mincy will study the effect of social infrastructure on racial differences in the intergenerational transmission of poverty. The researchers will look into whether policy changes and introduction of specific income support programs such as the Earned Income Tax Credit, Supplemental Nutrition Assistance Program, and Temporary Assistance for Needy Families reduce racial disparities in poverty rates across generations.
  • Using three major empirical techniques, Janice Fine, Daniel Galvin, Jenn Round, and Hana Shepherd seek to understand the relationship between geographic region, race, labor standards enforcement, and minimum wage violations in the United States. Their research also aims to better understand the role of federalism in creating and maintaining Black-White racial wage disparities in the U.S. economy.
  • Luca Perdoni will estimate the effects of redlining and other discriminatory property assessment practices on home values, income composition, and residential segregation over both the short and long terms.
  • Examining the racial divide in U.S. homeownership rates, Cherrie Nicole Bucknor will determine the impact of extended-family wealth on the ability of renters to transition to owning their homes. Her research will contribute to the literature on intergenerational transmission of wealth and the impact of structural racism, as well as propose policy ideas that could address persistent racial wealth inequality in the United States.
  • Recognizing that surveillance is ubiquitous in the lives of the formerly incarcerated, Brandon Alston will examine the effect that a criminal record has on upward mobility and work opportunities among Black men. He will explore whether surveillance reproduces inequality, including by mediating access to vital economic institutions and supports.

Equitable Growth not only deepened our previous commitment to support research on the roots and effects of structural racism and discrimination, but also sought, for the first time, to fund studies on the economic effects of climate change.

  • Mark Curtis and Ioana Marinescu will study the distributional implications for U.S. workers in a low-carbon economy. They will look at the effects of reducing dependence on carbon-intensive industries and increasing investment in green and renewable industries on opportunities and wages for workers, as well as which workers benefit from such changes.
  • Moving away from standard climate-economy models, Gregory Casey, Stephie Fried, and Matthew Gibson aim to capture how vulnerability to climate change differs between consumption and investment sectors of the economy and how this difference evolves over time. It will build on previous research by considering climate change a determinant of productivity and taking a more disaggregated look at the economy.
  • Jonathan Colmer and John Voorheis will examine the unequal effects of hurricanes in the United States on disadvantaged and advantaged populations. They seek to provide a deeper understanding of the consequences of and responses to hurricanes and differences across socioeconomic and demographic groups.

Another first-of-its-kind development for Equitable Growth’s grant program this year were the investments made in research focused solely on child care, the importance of which for the smooth functioning of the economy the coronavirus pandemic has underscored.

  • Julia Henly and David Alexander will look at the effects of the coronavirus pandemic on inequities in subsidized child care and provide policy suggestions to strengthen the home-based child care sector, which tends to be more affordable and accessible, especially for Black, Latinx, low-income, and rural families.
  • In interviews with licensed and unlicensed child care providers, Corey Shdaimah, Bweikia Steen, and Elizabeth Palley seek to better understand how informal, home-based child care providers can be supported in their efforts to increase access to early childhood care in the United States. The researchers will identify challenges these child care providers face in delivering high-quality, affordable care options to families that need it.
  • Jonathan Borowsky will explore racial disparities in access to family child care centers—those located within an operator’s home—by looking at homeownership rates and disparities in homeownership by race. Borowsky poses that areas with lower rates of homeownership may lack access to this type of child care facility, considering that family child care centers face licensing obstacles in rental properties.

Three grantees in this year’s cycle will study large, national firms and the effects of employer power on workers’ wages and labor market dynamics in the United States.

  • Focusing on monopsony power and dignity at work, Arindrajit Dube will research how nonwage amenities, such as control over one’s schedule, contribute to workplace power. He will survey Walmart workers in an effort to uncover the level of monopsony present in the U.S. labor market and the role that these amenities play in monopsony circumstances.
  • Binyamin Kleinman will look at the relationship between rising regional inequality and the increasing dominance of large employers. He will study where these “superstar” firms create high-paying, high-skill jobs versus low-wage jobs, and how that contributes to regional inequalities and unequal demand for skills across geographic areas.
  • Justin Wiltshire will study the effect of Walmart supercenters on local labor markets and wages. He will compare aggregate employment and earnings in areas where a supercenter opened to those in areas where Walmart tried but did not succeed in opening a supercenter.

Other labor market studies include:

  • Research by Matthew Johnson and David Levine into the effect of government safety regulations enforcement on individual workers’ earnings. Johnson and Levine will compare the wage trajectories of establishments (and workers at those establishments) randomly selected for inspection by the U.S. Occupational Safety and Health Administration with those eligible but not selected for OSHA inspection.
  • A study by Ashvin Gandhi and Krista Ruffini on minimum wage reforms and firms’ occupational composition, distribution of hours, and scheduling practices. Using the nursing home sector—a major employer of low-wage workers—as a case study, the researchers will examine wage policies in the industry and their impact on workers’ economic well-being, as well as racial and gender pay divides.
  • Research by Ihsaan Bassier on sectoral bargaining in monopsonistic labor markets. Bassier will use data from South Africa, where 40 percent of workers in the formal sector are covered by industry-region sectoral bargaining, to determine the impact on worker power and whether these agreements mitigate the effects of monopsony.

Much like our previous grant cycles, Equitable Growth this year will fund a number of compelling studies on market concentration and competition, including in the healthcare, agriculture, and Big Tech sectors.

  • Following decades of mergers in agribusiness, Matthew Weinberg, Nathan Miller, Francisco Garrido, and Minji Kim seek to learn the effects of increasing buyer concentration in the beef industry. They will determine the effects of this oligopsony power and how it has changed in the past two decades.
  • Paul Eliason, Ryan McDevitt, and James Roberts will examine the impact of joint ventures between physicians and dialysis facilities on patient referrals, spending, and outcomes by building a first-of-its-kind dataset tracking the ownership of dialysis facilities, including whether physicians have an ownership stake.
  • Adam Jorring and Greg Buchak will study the impact of local concentration of mortgage lenders on household credit access and homeownership. They will build off preliminary results showing that in areas with higher concentration, lenders charge higher fees, mortgage applications are rejected more often, and the pool of originated mortgages is less risky.
  • Florian Ederer, Mireia Giné, Bruno Pellegrino, and Martin Schmalz plan to study the welfare effects of common ownership. Their study, performed in four parts, will link executive compensation and measures of common ownership, examine the impact of common ownership on innovation, and collect data on common ownership outside the United States.
  • Diving into Amazon.com Inc.’s platform, German Gutierrez will look at the evolution, market power, and welfare implications of the Big Tech giant and whether its actions and behavior have anticompetitive results.
  • Kritika Goel will answer two main questions in her research: What are the welfare effects of third-degree price discrimination, and what are the effects of third-degree price discrimination on the take-up of newer and better technologies? Using defibrillators as a case study, she will estimate a model of supply and demand, and conduct a counterfactual analysis in which third-degree price discrimination is banned.

Likewise, research projects centered around the macroeconomy and taxation, mobility, and human capital and well-being received funding to further develop our understanding of how these areas are connected to rising economic inequality.

  • Loujaina Abdelwahed and Jacob Robbins will track inequality in real time amid the coronavirus pandemic and ensuing recession. They will measure consumer spending inequality in the United States to determine the impact of the pandemic on consumption inequality along the income distribution, as well as the impact of government stimulus payments and other income support programs on spending and consumption patterns.
  • Cristobal Young will focus on the implications for progressive taxation of the 2017 Tax Cuts and Jobs Act’s cap on state and local tax deductions. Young seeks to determine whether the rich are more likely to move when their tax rates are high, whether the TCJA tax differential led to greater migration, and whether the TCJA increased the likelihood that, if rich people moved, they went to lower-tax destinations.
  • Building on existing research on the effects of monetary policy on income inequality, Louphou Coulibaly and Javier Bianchi will look specifically at macroprudential regulation and redistribution. They will research how the effectiveness of prudential capital controls as a financial stability tool are affected by the distribution of income, and what the distributional implications are of prudential regulations.
  • Wendy Morrison will examine how increasing labor market polarization affects the transmission of monetary policy. Morrison’s research looks into whether investment spurred by monetary policy will have muted effects on aggregate consumption if workers whose labor is complementary with capital have lower marginal propensities to consume.
  • Basil Halperin and Daniele Caratelli will build a realistic model of price stickiness to help inform central bank policies around inflation targeting. They will explore whether central banks should use nominal income targeting rather than inflation targeting, and whether this change in policy would mean that central banks do not have to tighten policy in response to strong wage growth.
  • Looking at the manufacturing industry after World War II, Andrew Garin and Jonathan Rothbaum will dive into the relationship between high-paying, stable manufacturing jobs and upward mobility among the less-educated workforce in the United States. They will examine how public investment in manufacturing facilities amid the war’s industrial mobilization effort created high-wage employment and how that investment contributed to upward mobility in the long term.
  • Meredith Slopen will study the impact of paid sick leave mandates on women’s employment, income, and economic security, assessing whether paid sick leave reduces short-term income volatility and increases long-term economic security.

This year’s applicants responded, as in years past, to Equitable Growth’s annual Request for Proposals and were selected in an extremely competitive process that included vetting by staff and a panel of external academic experts, along with review and approval by the Equitable Growth Steering Committee. As our 2021 grantees finalize and publish their research, we will ensure that policymakers and the public are aware of the latest evidence on these important questions about economic inequality and growth, continuing to serve as a bridge between the academic and policymaking communities.

Posted in Uncategorized