There's more to a 401K savings account than meets the eye, particularly when looking at factors such as age and race. TCF fellow Harold Pollack explains the ways that intergenerational wealth disparities play a role in a worker's ability to save for retirement.
Differences in financial sophistication certainly play an important role. An improved system might help employees make better choices. Minority workers at this firm strongly favored safer asset classes such as money market funds that provide very low returns over the long-run. An opt-out system with simple, low-fee target date funds could be especially helpful.
Read Pollack's full article featured in The Washington Post.
The program known as "Gautreaux" which is native to Chicago, decrees that the Chicago Housing Authority provide rent vouchers for black residents to move to white suburbs in an effort in desegregation. There's been substantial evidence that those families who were gifted the vouchers achieved levels of success over those remaining in low-income areas. TCF fellow Stefanie DeLuca who has worked closely with the Baltimore Mobility Program, which is similar the Gautreaux, confirms in the Deseret News article that there is a real transformative nature to the socio-economic diversity created by the programs.
Between 1976 and 1998, more than 25,000 people relocated to more than 100 communities in the Chicago area, half to integrated suburbs, and half to integrated urban areas.
The result? The children of those families were more likely to graduate from high school, attend four-year colleges and be employed with higher pay and benefits. They were much less likely to be on assistance programs.
The rest of the piece can be read here.
Although job openings have recovered to pre-recession levels, the labor market is far from where it was in terms of actual hirings. TCF policy associate Mike Cassidy sums up the state of the economy by saying: "hires and separations rates have failed to regain the losses they sustained during the Great Recession." This statement indicates that the rate of turnover is low, which is detrimental to maintaining a healthy economy.
As much as we should cheer the job growth we’ve seen in recent months, we must remember the lessons the flows data impart. Opportunities have not been spread evenly. The recovery is not (yet) as robust as we’d like to believe. And, perhaps most significantly, understanding how to get there is just as important as knowing where we want to go.
Read Mike's article featured in US News & World Report.
In case you are unfamiliar with the recently coined term, "the boomerang generation," TCF fellow and economist Mark Thoma explains the definition and what is causing it's rise. The term describes the rising trend of young Americans who have moved back into their parent's homes for various reasons. The most prominent of these reasons, says Thoma, is the rising cost and likelihood of student debt.
However, the correlation between the number of young people living with their parents and growing student debt burdens is much larger. Further analysis estimates that a $10,000 increase in student debt per student leads to a 2.9 percentage point rise in the rate of students living with their parents.
Read Thoma's full article in CBS MoneyWatch
While the social safety net draws criticism from the conservative cohort, TCF fellow and economist Mark Thoma says that the social insurance programs and their recipients in the US are often mischaracterized. Poverty is rather a "mainstream event" that is experienced by nearly forty percent of Americans ages 25 to 60 at some point in their lifetime for about one year.
Business cycles, and the unemployment, homelessness, lack of adequate food, and so on that come with them can all be mostly eliminated under socialism, but in a capitalist system a worker who does everything right to provide for his or her family – show up every day, works hard, etc. – can suddenly find themselves out of work and struggling to make ends meet. Business cycles are an inherent feature of a capitalist system, and globalization and technological change add to the insecurity that workers feel.
Read the full article by Mark Thoma.
TCF fellow and sociology professor at Johns Hopkins Stefanie DeLuca is featured in an Atlantic article that describes a housing experiment in Chicago that relocates low-income families to more prosperous neighborhoods in hopes that socio-economic integration will help to lift less fortunate families out of severe situations in the long-term. DeLuca says that her research has shown that this is not always the case for low-income families who receive Section 8 vouchers, and that these families often do not leave their familiar community to seek better opportunities. Sometimes it takes counseling and guidance to shift a family's view of moving out of their living situaiton.
In her field work, which examined 110 households in depth, DeLuca found that living in a different neighborhood helped the Baltimore families make better choices when it came to housing and their children’s schooling. Families had higher expectations for the neighborhoods where they lived and showed “new appreciation” for racial and ethnic diversity and good schools, often becoming willing to make difficult trade-offs for the sake of their families. Parents said it was a new world: One woman told researchers that she now goes to work, comes home, pays the bills and has fun with her children, whereas she used to go drinking with friends.
Read the full article featured in The Atlantic.
In recent decades, and especially since 2000, the richest Americans have enjoyed soaring income and wealth while the rest of the population's living standards have stagnated. The Century Foundation was one of the first institutions to raise serious concerns about these trends and propose ideas for improving economic conditions for all Americans- not just the fortunate few.
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