How Poverty Makes Workers Less Productive

[applegrove]

How Poverty Makes Workers Less Productive

February 2, 20216:31 AM ET

GREG ROSALSKY at NPR Planet Money

https://www.npr.org/sections/money/2021/02/02/961910289/how-poverty-makes-workers-less-productive

"SNIP.....

The researchers then monitored the workers' on-the-job performance, comparing them to a group of workers that didn't get paid upfront. The researchers find that the workers who were paid upfront were significantly more productive, making 6.2% more plates per hour. The biggest effect was seen with the poorest workers. Even more, the plates they made were less likely to be marred by mistakes, indicating they were more attentive on the job.

The authors conclude that giving workers cash upfront helped alleviate the mental burden of their financial problems and freed them to be more productive. It echoes findings from other studies on the psychological consequences of poverty, but it is novel because it looked at the effects of it at a real job rather than in a laboratory setting.

Given the emerging body of evidence that suggests the cognitive load of poverty hurts low-income folks' ability to escape their circumstances, the authors argue that policymakers should consider reshaping welfare programs with these psychological issues in mind. Giving poor people cash without conditions, for example, could do a lot to help them earn more cash on their own.

We've written before in the Planet Money newsletter about growing evidence that our welfare programs may not be up to the task. A study last year by the California Policy Lab found evidence that a huge percentage of poverty-stricken Californians are not getting the Earned Income Tax Credit because of the difficulty of filling out tax forms. Mullainathan and his colleagues' work is a reminder that policymakers should recognize the cognitive burden on many of those who live in poverty and make it easier for them to get assistance.



.....SNIP"

[applegrove]

1. Business and Industry would know this. They do endless studies on

productivity. They must see a benefit in powerlessness... like not voting or something like that.

[DBoon]

3. It's about power

It is worth losing 6.2% productivity for a business to know they own their workforce.

A worker that worries how they can afford their next meal is a worker that won't cause trouble for the boss

[Shell_Seas]

4. At the end of the day they care most about profits.

[CrispyQ]

2. We'd be surprised how many ills in our society could be fixed with a War on Poverty.

We never declare that war, though, do we?

[WhiskeyGrinder]

5. It was declared, though; informally, in 1964.

There was a big pushback, as there always is, over time. The final blow against LBJ's effort was the so-called Personal Responsibility and Work Opportunity Act, signed by Bill Clinton.

[I_UndergroundPanther]

6. Poverty hurts people in many ways.

Capitalism is a failure.

[Ollie Garkie]

7. it s about power...

And profit more than actual profit. If this doesn't prove that at least some elements of capitalism are highly questionablet then I don't know what does.