Are people 'coming back off the sidelines' and into the workforce, as Ivanka Trump says?
"I think one of the tremendous opportunities that we're seeing because the economy is so strong is that people who have been out of the workforce are coming back off the sidelines. And this is something we are working incredibly hard to incentivize. Because there is a large population of prime age men and women who are out of the workforce and who are now slowly starting to return. Two million people have come off food stamps and are starting to re-enter the economy and we think that's incredibly positive and we're very excited about that." - Ivanka Trump, in an interview on Fox Business Network, June 29, 2018
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Touting the Trump administration's economic achievements and celebrating the six month anniversary of the tax cut, Ivanka Trump boldly pointed to people "coming back off the sidelines" as evidence of success. Setting aside that it is far too early to claim credit for broad economic trends, Trump's choice of supporting evidence - the labor participation rate and number of food stamp recipients - is odd. These rates are influenced by changing demographics and long-term trends, not just the administration's policies or short-term economic gains.
Let's dig in.
The Facts
There are two ways that "people who have been out of the workforce" can "come back off the sidelines." One is to join the labor force. The other is to gain employment. These are not the same.
In this case, it appears Ivanka Trump is referencing the labor force, not employment - which has been declining for more than a decade. Generally speaking, the labor force participation rate measures non-institutionalized civilians ages 16 and older who were either employed or actively looking for a job.
But Trump specifically refers to "prime age men and women." If we look only at the participation rates of prime age adults between the ages of 25-54, workforce participation has increased slightly, 0.2 percent between May 2017 and May 2018.
Gary Burtless, a senior fellow at the Brookings Institution, argues workforce participation of adults between 25-54 is a more accurate representation of the labor force because they are most likely to be employed, having finished their education but having not yet retired. He noted, "This trend has been well underway. We had a very, very long recovery from an extremely deep recession. It wasn't spectacularly fast but it has been spectacularly long."
Does this mean "large populations" are coming "back off the sidelines," as Trump says? Not necessarily. It has a lot to do with demographics trends of the specific age group she highlighted. (For some perspective, labor participation among this group has declined by 1.3 percent between 2007-2017. The same measure jumped by 4.8 percent points between 1980-1990 as children born to the baby-boom generation entered the workforce.)
Burtless pointed to the increase in the employment to population ratio among adults 25-54, which measures how much of the adult population is employed. It is .8 percent higher than a year ago. Like the labor force participation rate, it's not a hugely fast increase. But it's improving faster because there is a decline in unemployment.
(It's possible that Trump was conflating employment and labor force participation, but when we asked for further explanation, the White House didn't return our request for comment.)
Trump then pointed to "two million people coming off food stamps" (an accurate statistic) as evidence of the economy's strength, noting that they were "starting to re-enter the economy." Experts say that's debatable.
To start with, 65 percent of people receiving food stamps or benefits from the Supplemental Nutrition Assistance Program (SNAP) are either children, elderly adults or non-elderly adults with disabilities - groups that are not part of the labor force. In fiscal year 2016, which spanned the Trump and Obama administrations, only 8.8 percent of SNAP participants were non-disabled adults between the ages of 18-49 in households where children were not present. In other words, the vast majority of the people on food stamps aren't working.
So, are the "two million people coming off food stamps" because the economy has improved? The exact reason for this decline is still unclear, but Elaine Waxman, a senior fellow in the Income Benefits and Policy Center at the Urban Institute, pointed to several possible forces for the decline.
For one, the economy could be helping - the recipient or someone in their household could have become employed or they could be earning more. It's also possible that nothing in their economic situation changed. Instead, they no longer qualify for SNAP because several states have rolled back recession-era waivers that allowed some adults to keep benefits for longer periods of time without employment. Reports have also suggested immigrant families with citizen children have also dropped out of the program for fear of the administration's immigration policies.
We asked the White House for additional information but they did not respond.
Pinocchio Test
Trump is straddling the line. Labor force participation among prime age workers has been increasing but not by "large" amounts, as she claims. It has been steadily, slowly climbing since well before the Trump administration took office. Plus experts argue that labor force participation has more to do with demographic trends than an individual administration's policy - especially one that hasn't even reached the halfway mark of its first term.
Furthermore, a stronger job market is likely one factor in the people coming off food stamps, but it is certainly not a metric to prove adults are "re-entering the economy." The majority of SNAP recipients are children, elderly or disabled. Of those who are able bodied adults, recent policy changes mean they may no longer qualify for food stamps, which doesn't equate to re-entering the workforce.
Trump is using accurate data to draw faulty conclusions. People may be "coming off the sidelines" but the evidence she cites is not proof. She earns Two Pinocchios.