Older and Wiser - Take Two

The Pew Research Center released another study that indicates a gap between the older and the younger...this time in favor of the older.

Households headed by older adults have made dramatic gains relative to those headed by younger adults in their economic well-being over the past quarter of a century, according to a new Pew Research Center analysis of a wide array of government data.

In 2009, households headed by adults ages 65 and older possessed 42% more median net worth (assets minus debt) than households headed by their same-aged counterparts had in 1984. During this same period, the wealth of households headed by younger adults moved in the opposite direction. In 2009, households headed by adults younger than 35 had 68% less wealth than households of their same-aged counterparts had in 1984.

As a result of these divergent trends, in 2009 the typical household headed by someone in the older age group had 47 times as much net wealth as the typical household headed by someone in the younger age group–$170,494 versus $3,662 (all figures expressed in 2010 dollars). Back in 1984, this had been a less lopsided ten-to-one ratio. In absolute terms, the oldest households in 1984 had median net wealth $108,936 higher than that of the youngest households. In 2009, the gap had widened to $166,832.

The entire report can be accessed here.

Older and Wiser

According to a recent report by the Pew Trust indicates that being older and wiser isn't always better...at least not when it comes to long term unemployment.

The Pew report found that although long-term unemployment does occur among all ages, those 55 and older are more likely to be out of work longer than younger works. 43% of those 55 and older who are unemployed remain so for more than a year.

While higher educated workers are less likely to lose their jobs to begin with, once unemployed there is no difference in the average length of unemployment among different education levels.

To read more about the Pew Trust analysis of unemployment, click here.

The Necessity of the Economic Census

When most people think of the U.S. Census Bureau, they think of the decennial census of population. It would be hard to find an average person that would think of the economic census when considering the U.S. Census Bureau, yet it provide essential details on every aspect of the economy of the United States.

The economic census, conducted in every year ending in 2 and 7, provides details on manufacturing, sales, industry, housing, updated population data, and other important inputs to the creation of the Gross Domestic Product (GDP) figures. The corresponding census of governments also provides data for GDP. Both of these census' are slated for significant cuts or cancellations in the House of Representatives 2012 appropriations bill.

Examples of data that would not be collected include statistics on establishment and employment of business across all industries, fees paid for real estate purchases, mining tonnage by geographic area, and cost of transportation by mode. All of these are statistics that businesses rely on to make informed market decisions. There is no other organization equipped to provide this amount of statistics detail spanning all sectors of the economy.

We are at a period in time when up to date information about the economy is key to government intervention and market practices. Neither the private sector nor the government will have the necessary data to respond to current economic problems if the census is cut.

Many groups are amazed that this is even in question at this time including the National Associate of Business Economists'. The head of the NABE's statistics committee, Maurine Haver, commented to the Huffington Post "It leaves me rather speechless, actually. I just don't understand it." Former Census Bureau leaders issued a joint letter to Congress explaining that "...going without a 2012 Economic Census in the midst of the worst recession in half a century is akin to turning off the country's economic GPS at the very moment it is critically needed."

Congress was careful not to change the budget much for the Economic and Statistics Administration which is responsible for the GDP data. However, they fail to recognized that most of the input data still comes from Census. Haver was quick to point out that "the basic data that go into the national accounts are born at the Census Bureau."

The Census Bureau has come under fire in recent years for the type of data it collects during the decennial census and in the American Community Survey, particularly from the far right. Cutting the economic census is not an appropriate response. A census that gathers valuable information for businesses and lawmakers in an unstable economy should be considered a priority by anyone who wants facts to drive their decision making process.

Given the time needed to benchmark data after a lapse in collection, the next useful economic data would be released in 2022....15 years after the 2007 Economic Census. We simple can not afford to miss that much of what is going on in the United States economy.