There Are Jobs, but Not Well-Paid Ones

The occupations with the fastest growth were retail sales (at a median wage of $10.97 an hour) and food preparation workers ($9.04 an hour). Each category has grown by more than 300,000 workers since June 2009.

Some of these new, lower-paying jobs are being taken by people just entering the labor force, like recent high school and college graduates. Many, though, are being filled by older workers who lost more lucrative jobs in the recession and were forced to take something to scrape by.

Catherine Rampell has a story in the Times this morning about how we’re adding a bunch of new jobs to the American economy, but unfortunately, they’re all low-paid. Job growth for middle- and high-wage jobs have been slow or stagnant.

So, what’s a person to do? Well, if we took anything away from yesterday’s Times Magazine story (“Who Wears the Pants in This Economy?”), it’s that we can go for the lower-paid job for the time-being (whether it’s in food service, or other growing sectors like nursing and education) and then work up to higher-paid ones. That story looked at a traditional, church-going town in Alabama where the men were used to earning most of the money (and having pastors preach to them that the Bible instructs them to be head of households) at the big athletic apparel company that dominated the town. When the company shuttered and the men lost their jobs, their wives took low-paid positions to get the bills paid, and they were subsequently promoted to higher-paid positions. Working your way up—it’s the American way.

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28 Comments / Post A Comment

So let’s say you go work at a fast-food restaurant for minimum wage. You’re one of twenty-five employees, but you work hard and eventually are made manager of the store.

What happens to the other twenty-four employees?

@stuffisthings Exactly. And the store manager position isn’t especially well-paid either.

Mike Dang (#2)

@stuffisthings Well, this is the complication of a recovery, right? We need job growth, we need an increase in the minimum wage (at the very least to keep up with inflation), we need affordable and effective education systems to help people achieve better paid jobs, transportation systems to get people to work, etc. The minimum wage job should be a starting point, and if not, it needs to become a living wage job.

minijen (#656)

@stuffisthings They go off to college.

Honestly, I’d like to hear the Republican answer to my original question. Even if everybody works hard, we can’t all be managers and CEOs, right?

r&rkd (#1,657)

@stuffisthings
Yeah, there isn’t a good answer to that. You’ve hit on a central flaw of meritocracy boosterism. If Republicans have anything to offer other than the consolation prize of “feeling that you are better than people with a different skin color,” I haven’t heard it, and can’t even imagine what it might be.

boysplz (#56)

@stuffisthings I guess they’d just tell you to start your own business and become a job creator if you don’t like your current setup. Which is all well and good as a soundbite but I’d like to see the America made up of 300 million small businesses.

r&rkd (#1,657)

@josiahg
Well, actually, I suppose there is the argument (didn’t Chris Christie make it that profile of him and his love for Springsteen in The Atlantic?) that rewards for success creates economic growth that lifts all boats? The problem with that argument, of course, is that it’s hard to explain how that works if you take a real look at the last 15 years.

@josiahg That still leaves the fundamental question unanswered. If the only path to economic security and a decent, dignified existence is to become a “job creator,” who is supposed to actually work in the jobs you’ve created?

I mean, the economy has been growing pretty well these last 30, 40 years — US economic activity is higher in 2012 than it has ever been, and next year will be higher still. Our GDP is $15 trillion, so with a labor force of 155 million people, that’s $96,000 per worker per year that we as a society get to figure out how to distribute. We’ve decided it makes sense to pay a few thousand of them salaries in the tens of millions of dollars to do work of questionable or demonstrably negative social utility, while 12 million of them are not working at all and are forced to rely on our meager social safety net to survive.

To give a concrete example: in 2011 Wall Street firms paid out $22.8 billion in bonuses. If that money were instead used to employ people at the US median wage, it could have “created or maintained” half a million jobs (a little less than the number of government employees laid off since Obama took office). The fact that our economic and political institutions are set up to allocate this money to Wall Street traders rather than teachers and firefighters represents a social choice, not an absolute lack. People need to understand that.

The US is not broke. The pie is big, it’s just divided up very, very badly.

deepomega (#22)

@stuffisthings The Free Market Orthodoxy position would be that wage doesn’t matter – earning power does. So low wages will translate to lower cost of living, and cheaper goods and services, which means the low wage earner will be able to afford more even without getting paid as much as a manager.

@deepomega But image how this would work: let’s say you work at the only grocery store in town. Your boss says “Deepomega, I’m cutting your pay, but don’t worry because it will allow me to lower the prices I charge you for food!” Try to figure out, mathematically, any way you could possibly come out ahead in that scenario.

deepomega (#22)

@stuffisthings I can’t imagine cutting your pay would make you come out ahead. I CAN imagine that cutting your pay and that of everyone else would, because grocery stores can leverage their efficiency and economies of scale better than you can – all that money they save they can sink into coming up with more efficient ways to get food to you. It is the exact same as the Keynesian multiplier, but coming from a corporation instead of a government, and the “taking money from you” is called “lowering wages” instead of “taxing.”

@deepomega So if we cut everyone’s pay to zero, all products would be free!

deepomega (#22)

@stuffisthings And if we raised the minimum wage to $100/hour, nobody would live in poverty.

@deepomega Alright, let’s compromise: minimum wage at $100 and all products are free. Deal?

DON (#706)

Weren’t we just talking about how, for the college educated portion of our country, the job market is basically back to pre-recession levels? I remember charts and graphs and whatnot. Here it is: http://thebillfold.com/2012/08/how-this-here-recession-has-been-working-out-for-people-without-degrees/

@DON Well what we essentially have is a hollowed-out system: lots of demand at the bottom and at the top, not much in the middle. If you have an MBA, or you’re willing to work for $8 an hour, you can probably find a job.

Also, unemployment levels for the college-educated may be back to pre-recession levels, but that doesn’t say anything about the quality of jobs.

I was trying to pull some BLS statistics but I guess my work has disabled Java. I suspect you’ll find earnings for people with bachelor’s degrees are down, while earnings for high-school dropouts have held steady, and earnings for people with advanced degrees are higher than ever.

deepomega (#22)

@stuffisthings MBA unemployment is high, actually. It’s sort of a liberal arts degree for Republicans. Check it: http://www.businessweek.com/bschools/blogs/mba_admissions/archives/2012/01/the_mbas_value_debatable.html

Edit to add a BLS chart. There’s not much evidence that upgrading to a graduate degree is worth it, unless you’re willing to go full PhD.

@deepomega I guess I believe it.

What is a representative high-qualification, high-wage job we can all agree on as an example? Petroleum engineer? What the hell kind of degrees do all these postsecondary educated people with 6-figure incomes have anyway?

ETA: Nice! I found the same chart but as a comparison between 1979 and 2002.

ETA: Also I have a master’s degree and but I earn a little more than the average for an associate’s degree. Sad face.

deepomega (#22)

@stuffisthings My gut here is that field is gonna be a way bigger predictor than education. Someone with a MLS isn’t going to magically be able to change the fact that there are too many people who want to be librarians. Someone with a BS in chemical engineering who’s willing to work for Dow is going to outperform someone with a PhD in classics. If I had my druthers, I’d add in a mandatory class for all middle and high schoolers explaining that pay is a function of a lot of things, including how many people want the same job you want.

jfruh (#161)

@stuffisthings The fundamental problem is that people have a hard time distinguishing between “anyone can become rich” (which is more or less true, though some people have a bigger head start than others) and “everyone can become rich,” which is obviously false because “rich” by definition means having more than other people. But the fact that anyone *could* become rich gives those anxious not to give up theirs an excuse to say that no wealth redistribution should happen under any system ever.

@deepomega Indeed. I think a lot of the convo around the value of education is obscuring some pretty big variance within the categories. For instance, I suspect a lot of people are making big money on Wall Street without a ton of formal education, the PhDs making bux in academia and private R&D are bringing up the median for all the worthless classicists, etc. etc.

deepomega (#22)

@stuffisthings Completely agree. I, personally, am inflating the shit out of the “Just has a bachelor’s degree” category – sorry future students of America, I am definitely misleading you as to your income prospects!

thenotestaken (#542)

*There are (in the post title)

sorry sorry sorry ugh

Mike Dang (#2)

@thenotestaken Updated, for your sanity!

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