The topic of child labor evokes strong emotions and old stereotypes, such as the chimney sweeps of Dickensian London. The good news is that nowadays child labor can be more pleasant and more rewarding. The bad news is that the question of how to protect working children is more complicated. A lot of children are grossly underpaid — not necessarily by the master sweep, but by their parents.
Increasingly more children, by which I mean minors below the legal working age, are producing content as online influencers. A lot of Instagram or YouTube or TikTok accounts feature such children, and they can be cute, endearing or (depending on your mood) annoying — as well as profitable. By one estimate, the most successful children working in this area — called “kidfluencers” — can generate more than US$20 million a year in revenue.
Their work might be a far cry from the labor of the chimney sweeps, but work it is, at least as the concept is understood in the US circa 2023. These children are under pressure, whether from their parents or from their algorithms, to produce content on a regular basis. Being a child social media star also involves a potential loss of privacy and a reframing of one’s image with one’s peers, which might be either positive or negative. These children can also be quite young. One star of a YouTube channel with more than 35 million subscribers, which started out as a toy-review site, was seven years old in the channel’s early days.
Legally, these children have no claim to the income their sites generate. Thankfully, many parents are loving and generous.
However, not all are so. There is no data on how social media earnings are distributed within the family, but the long history of child movie and TV stars indicates that many receive little or nothing.
Enter the state of Illinois, where a recently passed law gives successful child social media stars a right to some percentage of the earnings they generate, to be held in a trust in their name until they turn 18. Such legislation has precedent. In the early days of Hollywood, California passed the Coogan Act, which gives child actors a right to a certain percentage of earnings, which employers have to place in trust accounts. New York has passed similar legislation.
The social media case is tougher to enforce, because the parents themselves are often the de facto employer and there is no contract specifying the terms. How would the relative contribution of the child to the family income be assessed? Time spent on screen? Cuteness? What if the social media presence leads to a book contract or a podcast?
Regardless, the law sends a clear signal that children do have some rights to generated income, and grown children can sue their parents if the money is not passed along.
Labor markets work best when there is a clearly defined notion of consent, but that is hard to come by when children perform services for their parents. What if a child expresses a desire to quit performing on social media and the parents respond that such income is needed to send the kid to college or pay for the family home? On what basis could the child’s response be considered as fair, well-informed and not under duress? It is neither practical nor desirable for the state to insert itself into family decisionmaking on a regular basis.
Given these problems, it is probably wise to pare back expectations of what “kidfluencer” legislation can accomplish. At the same time, it is probably better to do something rather than nothing, if only for symbolic reasons and because this sector of the economy is likely to grow.
At the margin, more protection for children’s rights might also boost child labor supply, and in a beneficial way. When I was 12 years old, I started winning money in chess tournaments and my parents let me keep all of it. A year later, I was giving chess lessons and being paid for it. Not only was I earning money from my labor, but I like to think I helped other players get better and maybe earn some money themselves.
In retrospect, I am glad I acquired those skills and experiences, but not all cases of “child labor,” if I may use that phrase, are so positive. For every kid — and family — who tries to earn early income, many more would fail and be left with nothing.
It is of course possible that granting kids greater legal rights to income might encourage more children to seek to become social media stars. On balance, I am okay with that outcome, but it is by no means an easy call.
Tyler Cowen is a Bloomberg Opinion columnist. He is a professor of economics at George Mason University and writes for the blog Marginal Revolution. He is the coauthor of Talent: How to Identify Energizers, Creatives, and Winners Around the World. This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
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