On the surface, Economic Literacy is something Americans seem to take very seriously. Economics seem to take up a large majority of the United States political discourse and when watching any news cycle you are bound to see multiple pieces about economics, and how the current economic climate will affect the average American.
However, when looked at with more depth it is immediately evident that the majority of Americans are unaware of how the current economic climate negatively affects many different communities. Not only are many Americans unaware of how things that should be unrelated to economics such as, gender, race and education have extreme negative effects on an individuals economic standing, many Americans are unaware that this is directly negatively impacts our society and economy as a whole. When analyzing an individuals Economic Status, their household income, education, and occupation need to be examined.
Economic Status is typically broken into three categories, high Economic Status, middle Economic Status, and low Economic Status. Any or all of the three variables, gender, race and education heavily impact placing a family or individual into one of these categories. Sociologists often even use Economic Status as a means of predicting negative behavior in different communities. Economic Literacy is empirical to understanding and changing these issues. One issue that is still discounted and minimized even with it mainstream coverage is the wage gap, specifically revolving around gender. The single biggest cause of the gender pay gap is occupational sorting of men and women into jobs that pay very differently throughout the economy. In the United States, these sortings account for 54 percent of the overall pay gap; making it the largest factor by far (Aamodt). For example, the U.
S. Census shows that women make up only 26 percent of highly paid chief executives but 71 percent of low-paid cashiers (Aamodt). Research suggests that this is due partly to social pressures that divert men and women into different college majors and career tracks, or to other gender norms such as women bearing disproportionate responsibility for child care, pressuring women into more flexible jobs with much lower pay (Aamodt).
Even age factors into the wage gap a woman will experience, with workers aged 18-24 experiencing a pay gap of just 2.2 percent, while women ages 55-64 see a wage gap of a staggering 10.5 percent (Aamodt). The gender wage gap negatively affects the economy in many ways but by far the biggest is the fact that many single mothers do not have the money to properly support a family and thus need to rely more on government aid.
Not only negatively impact the American economy by restricting the spending of women affected it also cost the government millions in aid and varies social safety nets. While some brush off this issue as unimportant, if the full economic affect wage gap was understood by the majority of Americans the wage gap would be treated with much more urgency. A lack of Economic Literacy has also caused income inequality to widened along racial and ethnic lines since the end of the Great Recession (Aamodt). African American children are 3 times more likely to live in poverty than Caucasian children. American Indian/Alaska Native, Hispanic, Pacific Islander, and Native Hawaiian families are more likely than Caucasian and Asian families to live in poverty (Costello; National Center for Education Statistics). Even looking at mortgage rates, minorities are more likely to receive extremely high-cost mortgages: African Americans (53%) and Latinos (43%), in comparison to Caucasians (18%), hindering many minority groups ability to purchase houses, something that has been a major contributor to the American economy since the beginning (Bureau, Census).
Unemployment rates for African Americans are typically double those of Caucasian Americans. African American men working full time earn 72% of the average earnings of comparable Caucasian men and 85% of the earnings of Caucasian women (Bureau, Census). Again, not only does this hinder the economic contribution of these groups by not leaving room for discretionary spending, it also is continuously costing the government money. These problems caused by a lack of Economic Literacy also negatively affects the education system.
African Americans and Latinos are more likely to attend high-poverty schools than Asian Americans and Caucasians (National Center for Education Statistics). In 2005, the high school dropout rate of Latinos was highest, followed by those of African Americans and American Indians/Alaska Natives (National Center for Education Statistics). In addition to economic situations that may deprive students of valuable resources, high-achieving African American students may be exposed to less rigorous curriculums, attend schools with fewer resources, and have teachers who expect less of them academically than they expect of similarly situated Caucasian students (Harrington). By not allowing certain children access to the same education as others based on their parents income we are premtively stacking the deck against children in lower income families. The lack of Economic Literacy on the systemic prejudices against ethnic minorities present in the United States economy creates additional barriers, specifically in healthcare.
In one study, one-fourth of American women of South Asian descent from affluent backgrounds did not have a pap smear in over 3 years, while that is surprising those from low Economic Status are even more at risk for not having this early detection test yearly (Bureau, Census). Low birth weight, which is related to a number of negative child health outcomes, has been associated with lower Economic Status seen most in ethnic, minority groups (Bureau, Census). Economic deprivation and racial discrimination have also been implicated in higher psychological distress. Children in high-poverty areas are even more likely to be exposed to alcohol and tobacco advertisements and drug distribution (African-American Income); they are also more likely to use drugs and exhibit antisocial behaviors (Bureau, Census). The odds of being diagnosed with schizophrenia were significantly higher for African Americans than Caucasians in lower poverty areas (Aamodt). African Americans are at higher risk for involuntary psychiatric commitment than any other racial group. Groups in low-poverty areas were also more likely to be referred for commitment by a law enforcement official than any other racial group (Bureau, Census). Additionally, low income and low education have been shown to be strong predictors of a range of physical and mental health problems, including respiratory viruses, schizophrenia.
Education in higher socioeconomic families is typically stressed as much more important, both within the household as well as the local community. In poorer areas, where food and safety are priority, education can take a backseat. The youth are particularly at risk for many health and social problems in the United States, such as unwanted pregnancies, drug abuse, and obesity. While these problems are severe they are largely due to the economic disparity experienced in these communities and by making America more Economically Literate and aware of these issues they can start to be changed with greater ease.A person’s Economic Status greatly affects our society in a number of ways including but not limited to lower education, lower income and poverty, poor health care, and all of this affects our society as a whole.
Low Economic Status and its correlates, such as lower education, poverty, and poor health, ultimately affect our society as a whole. There is also a correlation to a person’s income and how likely they are to commit a crime. This was shown heavily during the Clinton Administration were African Americans had a higher average income than ever before and crime rates in those communities hit the lowest points in decades. Inequities in wealth and quality of life are increasing in the United States and globally. Despite these challenges, behavioral and other social science professionals possess the tools necessary to study and identify strategies that could alleviate these disparities at both individual and societal levels. Research has shown that race and ethnicity in terms of stratification often determine a person’s Economic Status, even when viewed separately from their parents current economic standing (Bureau, Census). Furthermore, communities are often segregated by Economic Status, race, and ethnicity.
These communities commonly share characteristics of developing nations: low economic development, poor health conditions, and low levels of educational attainment. Low Economic Status has consistently been implicated as a risk factor for many of the problems that plague communities. Even just looking at murder rates among the general U.S. populus it is an irrefutable fact that murder rates go up significantly during recessions, depressions, and general economic “droughts”. In areas which have been impoverished for their entire existences it is no wonder that these major wage gaps experienced by all types of people, generally with the exception of white males, affects communities in horrendous ways. Seeking protective factors to minimize these risks is something our community must aim to do, as many researchers have reviewed literature that highlights the resilience of persons overcoming social challenges associated with skewed distribution of resources (Bureau, Census). It is important to understand that continually skewed distributions breed conditions that ultimately affect our entire society.
Thus, we all would benefit from an increased focus on the foundations of economic inequities and its correlates, such as racial and ethnic discrimination and efforts to reduce the deep gaps in Economic Status in the United States and abroad. Variance in Economic Status, including disparities in the distribution of wealth, income, and access to resources, affects everyone. Economic Status, race and ethnicity are very clearly shown to be intimately intertwined but by increasing the American populus’ Economic Literacy these problems can start to be solved .
Gender and Race pay gaps their symptoms are a real labor market phenomenon, both in the U.S. and around the world. Even when comparing statistics revolving around workers with similar job titles, at similar employers, with comparable education, experience and locations, a large and statistically significant difference is shown when comparing the wages of different races and genders as well as the role these differences play in communities around the globe. Only through learning about these issues can the American public become more Economically Literate and start to face these problems head on.