Fed Report: Unemployment, Wages Don’t Affect Crime Much


With layoffs a near-daily occurrence, a report by the Federal Reserve Bank of St. Louis found that unemployment and low wages do not have a significant effect on crime – at least in the short term, reports the Associated Press. When they do, the crimes tend to be nonviolent offenses such as property theft rather than murder, assault, and rape.That was true for most of the 23 large U.S. cities analyzed by economist Thomas Garrett. He said it takes time for worsening economic conditions to affect crime. Earlier research explored how unemployment or low wages affect crime over 10 or 20 years. The Fed study looked at how month-to-month changes in wages and unemployment affect crime.

Garrett said the findings beg other questions, such as where is the tipping point for those who would commit crimes? “How long does a person have to be unemployed or experience low wages to commit a crime?” he asked. Garrett looked at the unemployment rate and minimum wage for 23 large U.S. cities as well as monthly crime data for murder, rape, assault, robbery, burglary, larceny, and vehicle theft. In St. Louis, some nonviolent crimes followed the economy. A 1 percent increase in the unemployment growth rate caused a comparable increase in the growth rate of robbery and vehicle theft.

Link: http://hosted.ap.org/dynamic/stories/M/MO_FED_CRIME_STUDY_MOOL-?SITE=MOSTP&SECTION=HOME&TEM

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