How many really
suffer as a result of labor market problems? This is one of the most critical
yet contentious social policy questions. In many ways, our social statistics
exaggerate the degree of hardship. Unemployment does not have the same dire
consequences today as it did in the 1930’s when most of the unemployed were
primary breadwinners, when income and earnings were usually much closer to the
margin of subsistence, and when there were no countervailing social programs
for those failing in the labor market. Increasing affluence, the rise of
families with more than one wage earner, the growing predominance of secondary
earners among the unemployed, and improved social welfare protection have
unquestionably mitigated the consequences of joblessness. Earnings and income
data also overstate the dimensions of hardship. Among the millions with hourly
earnings at or below the minimum wage level, the overwhelming majority are from
multiple-earner, relatively affluent families. Most of those counted by the
poverty statistics are elderly or handicapped or have family responsibilities
which keep them out of the labor force, so the poverty statistics are by no
means an accurate indicator of labor market pathologies.
Yet there are also
many ways our social statistics underestimate the degree of
labor-market-related hardship. The unemployment counts exclude the millions of
fully employed workers whose wages are so low that their families remain in
poverty. Low wages and repeated or prolonged unemployment frequently interact
to undermine the capacity for self-support. Since the number experiencing
joblessness at some time during the year is several times the number unemployed
in any month, those who suffer as a result of forced idleness can equal or
exceed average annual unemployment, even though only a minority of the jobless
in any month really suffer. For every person counted in the monthly
unemployment tallies, there is another working part-time because of the
inability to find full-time work, or else outside the labor force but wanting a
job. Finally, income transfers in our country have always focused on the
elderly, disabled, and dependent, neglecting the needs of the working poor, so
that the dramatic expansion of cash and in-kind transfers does not necessarily
mean that those failing in the labor market are adequately protected.
As a result of such
contradictory evidence, it is uncertain whether those suffering seriously as a
result of labor market problems number in the hundreds of thousands or the tens
of millions, and, hence, whether high levels of joblessness can be tolerated or
must be countered by job creation and economic stimulus. There is only one area
of agreement in this debate—that the existing poverty, employment, and earnings
statistics are inadequate for one their primary applications, measuring the
consequences of labor market problems.
Questions:
1. Which
of the following is the principal topic of the passage?
(A) What causes
labor market pathologies that result in suffering
(B) Why income
measures are imprecise in measuring degrees of poverty
(C) Which of
the currently used statistical procedures are the best for estimating the
incidence of hardship that is due to unemployment
(D) Where the
areas of agreement are among poverty, employment, and earnings figures(E)
(E) How social
statistics give an unclear picture of the degree of hardship caused by low
wages and insufficient employment opportunities
2. The
author uses “labor market problems” in lines 1-2 to refer
to which of the following?
(A) The overall
causes of poverty
(B)
Deficiencies in the training of the work force
(C) Trade
relationships among producers of goods
(D) Shortages
of jobs providing adequate income(D)
(E) Strikes and
inadequate supplies of labor
3. The
author contrasts the 1930’s with the present in order to show that
(A) more people
were unemployed in the 1930’s
(B)
unemployment now has less severe effects
(C) social
programs are more needed now
(D) there now
is a greater proportion of elderly and handicapped people among those in
poverty(B)
(E) poverty has
increased since the 1930’s
4. Which
of the following proposals best responds to the issues raised by the author?
(A) Innovative
programs using multiple approaches should be set up to reduce the level of
unemployment.
(B) A
compromise should be found between the positions of those who view joblessness
as an evil greater than economic control and those who hold the opposite view.
(C) New
statistical indices should be developed to measure the degree to which
unemployment and inadequately paid employment cause suffering.
(D)
Consideration should be given to the ways in which statistics can act as
partial causes of the phenomena that they purport to measure.(C)
(E) The labor
force should be restructured so that it corresponds to the range of job
vacancies.
5. The
author’s purpose in citing those who are repeatedly unemployed during a
twelve-month period is most probably to show that
(A) there are
several factors that cause the payment of low wages to some members of the
labor force
(B)
unemployment statistics can underestimate the hardship resulting from
joblessness
(C) recurrent
inadequacies in the labor market can exist and can cause hardships for individual
workers
(D) a majority
of those who are jobless at any one time to not suffer severe hardship(B)
(E) there are
fewer individuals who are without jobs at some time during a year than would be
expected on the basis of monthly unemployment figures
6. The
author states that the mitigating effect of social programs involving income
transfers on the income level of low-income people is often not felt by
(A) the
employed poor
(B) dependent
children in single-earner families
(C) workers who
become disabled
(D) retired
workers(A)
(E) full-time
workers who become unemployed
7. According
to the passage, one factor that causes unemployment and earnings figures to
overpredict the amount of economic hardship is the
(A) recurrence
of periods of unemployment for a group of low-wage workers
(B) possibility
that earnings may be received from more than one job per worker
(C) fact that
unemployment counts do not include those who work for low wages and remain poor
(D)
establishment of a system of record-keeping that makes it possible to compile
poverty statistics(E)
(E) prevalence,
among low-wage workers and the unemployed, of members of families in which
others are employed
8. The
conclusion stated in lines 33-39 about the number of people who suffer as a
result of forced idleness depends primarily on the point that
(A) in times of
high unemployment, there are some people who do not remain unemployed for long
(B) the
capacity for self-support depends on receiving moderate-to-high wages
(C) those in
forced idleness include, besides the unemployed, both underemployed part-time
workers and those not actively seeking work
(D) at
different times during the year, different people are unemployed(D)
(E) many of
those who are affected by unemployment are dependents of unemployed workers
9. Which
of the following, if true, is the best criticism of the author’s argument
concerning why poverty statistics cannot properly be used to show the effects
of problems in the labor market?
(A) A
short-term increase in the number of those in poverty can indicate a shortage
of jobs because the basic number of those unable to accept employment remains
approximately constant.
(B) For those
who are in poverty as a result of joblessness, there are social programs
available that provide a minimum standard of living.
(C) Poverty
statistics do not consistently agree with earnings statistics, when each is
taken as a measure of hardship resulting from unemployment.
(D) The elderly
and handicapped categories include many who previously were employed in the
labor market.(A)
(E) Since the
labor market is global in nature, poor workers in one country are competing
with poor workers in another with respect to the level of wages and the
existence of jobs.
Answers:
1.
E
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2.
D
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3.
B
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4.
C
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5.
B
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6.
A
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7.
E
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8.
D
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9.
A
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