The month after winning the 2015 Nobel Prize in economics, Angus Deaton, whom we interviewed in January 2014, and his wife, fellow Princeton Professor Anne Case, published a new paper on the surprising rise in death rates among middle-aged white Americans since 1999. Their analysis showed that this trend, which is not only moving in the opposite direction from other age groups and races but is also unique to the United States, was driven in large part by a sizable increase in drug and alcohol poisonings, suicide, chronic liver diseases and cirrhosis.
According to the report, published in November, “concurrent declines in self-reported health, mental health, and ability to work, increased reports of pain, and deteriorating measures of liver function all point to increasing midlife distress.” In other words, this demographic group is working less and becoming increasingly disillusioned with their life circumstances, leading to a rise in mental health issues, drug and alcohol abuse, and suicide.
Data from the Bureau of Labor Statistics show that, among white American men, labor force participation (the share of the population that is employed or actively looking for work) has fallen most among the 45- to 54-year old cohort, with a significant step down in the post-1999 time frame consistent with the Deaton/Case analysis (Chart 1). Labor force participation among white women follows a much different trend but notably peaked around 1999 and has trended down since (Chart 2).
Although other races and ethnicities among this middle-aged cohort have lost ground as well, the drop is most marked among whites. As shown above, labor force participation rates have fallen 2.9 and 3 percentage points since 1999 among 45- to 54-year-old white men and women, respectively. Labor force participation rates among African-American men and women in the same age group are down only 1.8 and 1.3 percentage points, respectively, and have risen for Hispanic men and women by 0.5 percentage points (Chart 3).
Not only is labor force participation declining, real wages are stagnant for those who are working. More disturbing still, the traditional family structure is disintegrating within this cohort. Many foresee the “white picket fence” stage by their 40s and 50s ― settled and living happily, with a steady income, a spouse, possibly kids, and home ownership. Reaching that age without achieving those goals can be emotionally devastating.
As we have pointed out in the past, married-couple households enjoy outsized income gains over other types of households. The shift among white 45- to 54-year-olds by marital status ― married, widowed, divorced, separated or never married ― since 1999 is thus nothing short of alarming.
Between 1976 and 1999, the 45- to 54-year-old white, female, married labor force grew by 3.6 million, while among the corresponding group of men, the labor force grew by 2 million. Since 1999, however, the labor force among those same cohorts increased by just 317,000 for women and a mere 38,000 for men. Nearly all of the growth in active workers in this group came from an increase in single individuals. Notably, these trends do not hold across races (Chart 4).
What does all of this have to do with rising death rates? It feeds directly into what Nobel Prize winner Daniel Kahneman, one of Deaton’s collaborators on research into income, life satisfaction and emotional well-being, describes as the importance of having a good “story” about one’s life. As he explained in our September 2014 interview:
The truth is, people are not really motivated by “happiness”; they are more interested in having a good “story” about their life, a story with which they can be satisfied. While I still believe that emotional experience matters most, the degree to which we achieve our life goals must be an important feature in a comprehensive view of subjective well-being. It would be silly to have a concept of well-being that does not incorporate the wishes people have for themselves.
In this context, the decline in labor market participation and the fragmentation of family structure for white middle-aged Americans fit directly into what professors Deaton and Case describe as a major cause of their rising death rates: “increasing midlife distress.” The American dream of the white picket fence years followed by a prosperous retirement is giving way to the reality of unrealized expectations, and public and economic policy are not keeping pace.
 Labor force participation has been rising for older age cohorts, not shown in the charts.
 Change is calculated as average 1999 labor force participation rate less October 2015 labor force participation rate. Note the difference in scale between the two charts.
 Real wages for white Americans have risen just 1 percent since 2000.
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