Combating Joblessness: An Analysis of the Principal Strategies that Have Influenced the Development of American Employment and Social Welfare Law During the 20th Century
124 Pages Posted: 22 Dec 1999
Three distinct strategies for combating joblessness have influenced the development of American employment and social welfare law. I term the first strategy "behavioralist," because it attributes joblessness to the behavior of jobless individuals themselves. I call the second strategy the "job shortage approach," because it attributes the problem to an aggregate shortage of jobs in the economy. I term the third strategy "structuralist," because it attributes the problem to structural barriers to employment that have a differential impact on different population groups. In Part One of this paper, I describe the history and influence of each of the strategies on the development of American employment and social welfare law. In Part Two, I assess the strengths and limitations of each strategy. In Part Three, I discuss the policy implications of this assessment. I argue that the best available empirical evidence suggests that the level of joblessness in the United States (above an unavoidable frictional floor) is determined almost entirely by the existence of a shortage of jobs relative to the number of persons seeking work. The size of this "job gap" fluctuates over time, but it persists across all phases of the business cycle and, in a dimensional sense, is always the primary cause of joblessness in the economy. What structural and behavior factors determine, I argue, is the distribution of joblessness among population groups--who is jobless rather than how many people are jobless. Based on this distinction, I suggest that the weaknesses of currently popular liberal and conservative policies to combat joblessness may stem from their tendency to focus exclusively on structural and behavioral problems except during recessions, when the importance of job shortages in causing joblessness is briefly acknowledged and addressed. I argue that unless structuralist and behavioralist policies are joined to an effective strategy to close the economy's job gap at the top of the business cycle as well as during recessions, the problem of joblessness is unlikely to be overcome. Micro and macro economic barriers to the success of such a policy are assessed in an effort to lay the groundwork for the construction of a successful strategy to reduce the economy's job gap across the business cycle, but the design of such a policy is not undertaken in this paper.
JEL Classification: J68, J78, K31
Suggested Citation: Suggested Citation