Misconceptions of Child Labor Laws


Similar to a discussion on price gouging, the topic of child labor is an emotional one, and for good reason. We’re much more likely to jump into action and fight for change when children are suffering. Our emotions take control, and at times this can do more harm than good, especially when we start to discuss the problem in certain parts of the world like Bangladesh. When everyone agrees on the problem and the solution seems obvious, we rarely take the time to check our premises to make sure they match up to reality.

Nobody is disputing that child labor is bad. So why not just call for a global ban? Or create disincentives for foreign industries that employ children? Before taking action, we must first determine if legislative bans are actually in the best interest of the children, and what would the future look like if no action was taken. We can assume that most parents want what is best for their children. If this is the case, then why did child labor ever exist? Why does it still exist in some parts of the world today?

Child labor exists to cover the cost of raising children in poor societies. Before the rapid increase in wealth (and thus standard of living) over the last century within the United States, most families worked long hours, typically on farms, just to afford the basic necessities of living. Because children were expensive to raise (especially when families are barely managing as is), kids were put to work as soon as possible, usually working alongside their parents. Without this extra income, children risked malnourishment.

Towards the end of the 19th century, social pressure pushed for government regulation of child labor in the United States. The federal government responded in 1916 by introducing the Keating-Owen Act, which attempted to restrict child labor through the regulation of interstate commerce. This lasted nine months before being struck down by the Supreme Court in Hammer v. Dagenhart.

The U.S. federal government tried once again in 1918 by attempting to place a tax on child labor with the Revenue Act. This was also struck down by the Supreme Court in Bailey v. Drexel Furniture Co.

The third attempt at regulation was successful. The government passed the Fair Labor Standards Act of 1938, which prohibited most non-agricultural child labor. If federal regulation played an important role in eliminating child labor, this should be evident from data from the U.S. census, which started measuring data on child labor in 1880. Based on census data and other research, the labor force participation rate of male children was 32.5% in 1880, 26.1% in 1900, and 6.4% in 1930. The rates for female children were lower, but followed a similar trend. According to the data, child labor was already in the process of declining long before the federal government took action.

But what about child labor laws within the states? In the early 1800s, a few states had some form of restriction on child labor, but these were rarely enforced. Social pressure in the late 1800s encouraged more states to begin passing laws. By 1899, 44 states had at least one law restricting child labor. Of those, 24 states abolished child labor under 14 for non-agricultural labor. By 1910, a total of 41 states eliminated non-agricultural child labor under 14.

Based on this information, state law could be the reason for the decline in child labor. But other factors likely played a larger role in eliminating child labor, and state governments passed regulation to take credit for trends that were already happening on their own.

During this time, the United States was going through a second industrial revolution. Innovation and new technology led to a rapid increase in wealth and standard of living. Children of wealthy parents went to school rather than work for the same reason as children in the present day: because their families could afford it. As the standard of living continued to rise prior to the depression, a greater number of families could afford to raise children without putting them to work. This is likely the reason why social pressure for a child labor ban appeared. Families that rely on income from their child’s job will not campaign for a child labor ban.

Immigration peaked during this time, which means immigrants were competing with children for unskilled labor. When the Great Depression hit in 1929, employment became increasingly rare. The remaining employment went to adults rather than children.

The difference between parents then and parents now is not love for their children, but rather their standard of living. As societies advance, the use of children for labor begins as an unfortunate symptom of poverty, and as poverty vanishes, so does said labor.

The danger of enforcing a ban on child labor on a poor society is clear from a report by UNICEF on the impact of the Child Labor Deterrence Act on Bangladesh, a nation known for its prevalence of child labor. In 1993, this bill was introduced in Congress with the intent of banning imports produced by child labor. The bill did not pass, but in preparation of the possibility of the bill passing, the textile industry in Bangladesh fired all 50,000 of its child workers. In 1997, UNICEF sent investigators to determine what happened to the children. The report states that these children searched for another source of income, and the researchers “found them in work such as stone-crushing, street hustling and prostitution — all of them more hazardous and exploitative than garment production.”

Unfortunately, this exists as a symptom of poverty, not as a problem that can simply be banned. To eliminate it across the globe, activists must avoid calls for a ban and instead call for that which encourages prosperity and wealth creation: economic freedom, limited government, and private property rights.

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Nathan A. Kreider is author of the Misconceptions column for Being Libertarian, and has written for the Austrian Economics Center, the Foundation for Economic Education, and the Liberalists. He also occasionally publishes a blog and video content, including short book reviews, which can be found on his website, nkreider.com. He can be contacted by email via [email protected]