The annual value in average benefits for not working rose to $14,000 per recipient in 2011 — the high was $16,000 in 2009 — up from $10,000 in 2007. Such increases were inversely related to changes in average hours worked. On average, Americans worked a stunning 120 fewer hours in 2009 than in 2007 — the largest contraction in work effort of any recession since the Depression. Since 2009, work hours and labor-force participation have remained at record lows even though the recession officially ended in June 2009.
Another frequently heard explanation for the slow recovery is the Keynesian idea that there has been a lack of consumer spending — which caused businesses to cut production and lay off workers. Yet:
Mulligan shows that, during the worst of the 2008-09 troubles, most sectors “outside of hard-hit construction and manufacturing…increased their use of production inputs other than labor hours.”…”Businesses perceive labor to be more expensive than it was before the recession began,” Mulligan writes. The reason for the added cost was that easier requirements for benefits — even as the government was pumping “stimulus” money into the economy — unwittingly reduced the supply of workers.
John C. Goodman is President and CEO of the National Center for Policy Analysis, Senior Fellow at The Independent Institute, and author of the acclaimed book, Priceless: Curing the Healthcare Crisis. The Wall Street Journal and National Journal, among other media, have called him the "Father of Health Savings Accounts." He is also the Kellye Wright Fellow in health care. The mission of the Wright Fellowship is to promote a more patient-centered, consumer-driven health care system.
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