For the last five years my wife and I have had a string of top-notch babysitters. Our two daughters have had the benefit of getting to spend time with young musicians, burgeoning scientists, and up & coming early childhood educators.
Talented, caring, and thoroughly underemployed: all of them were college educated.
What’s been true in my experience has also been reflected by the employment data of the recession. According to the Center for Labor Market Studies at Northeastern University, the rates of underemployment for recent college graduates have grown from 27.4% in 2007 to 37% on 2012. Paired with straight up unemployment that means 1 of every 2 recent college graduates are under- or unemployed.
What underlies this trend, however, is not lazy students, bad schools, or superfluous college majors, what drives this trend is lousy jobs. According to a 2012 report by the Center for Economic Policy Research, since 1979 the U.S. economy has lost about the one-third of its ability create good jobs. If we were creating good jobs (meaning those that pay $18.50 an hour and have health insurance and retirement benefits) in the same way we were in 1979, 34.2% of workers would have good jobs. Instead only a shrinking 24.6% of U.S. workers have good jobs.
This trend, decades in the making, was accelerated during the recession. The National Employment Law Project has documented how many low-, mid-, and high-wage jobs were destroyed in the recession and how many of each was re-created during the recovery. They found that huge losses amongst mid-wage jobs (ex. truck drivers, secretaries, and carpenters) were being only meagerly replaced, while low-wage jobs (ex. retail, food preparation, and home care aides) were an increasing share of those being created as part of the overall recovery. They found that:
– Lower-wage occupations were 21 percent of recession losses, but 58 percent of recovery growth.
– Mid-wage occupations were 60 percent of recession losses, but only 22 percent of recovery growth.
What is going on? There are several causes for this: unrelenting attacks in worker organizing and the public sector overall, offshoring of jobs to low-standard economies, the shift of industrial growth from manufacturing to the service sector, and, yes, good old fashioned excessive profit-taking.
According to the St. Louis Federal Reserve, in 2013, U.S. corporations are making more per dollar of sales than they ever have before. Meanwhile, wages as a percent of the overall economy have reached an all-time low. In other words, the productivity gains being created by workers are simply not being shared those workers.
At this point, it’s important to check our sense of Minnesota exceptionalism. Yes, the women are still strong and the men remain good-looking, but the jobs, well, they’re pretty much average. Minnesota’s low-wage job trends are as dispiriting as the U.S. trends.
Two key ways the state measures these trends is by doing a ten year forecast of a) the number of jobs that will be added in a given occupation and b) the number of job replacement openings that will occur in those occupations. (Replacement openings are a measure of how often a job will be available to jobseekers due to turnover, retirements, etc.)
Six of the top ten occupations that will add the greatest number of jobs have median wages below $15 per hour.
Seven of the top ten occupations that will have the greatest number of replacement openings have median wages below $15 per hour.
This is the future of work in Minnesota. It has consequences. If this trend continues unabated, the underemployment the college graduates will continue. Income and wealth inequality will grow. The number of people who both work and live in poverty will increase. Upward social mobility will slow. Consumer demand will remain sluggish. With more cautious customers, hiring will lag. We risk wrecking the basic deal that has kept generations of Minnesotans working and saving: the promise that if you work hard you can get ahead. This promise, though never fully true for women and people of color, can be renewed if we fight for it like those before us did. It can be expanded if join together across race, class, culture, gender, and geographic divides to do so.
We must act together to demand a) that the quality of jobs in Minnesota be improved, b) that new jobs be created in sectors of economy where there is compelling public need, and c) that every Minnesotan who wants to work can.
This blog is the first of a series that will explore the future of work in Minnesota. Future posts will take on the impacts of low-wage work, the causes of the crisis, the economic case for raising standards, and the policy prescriptions to do so, like raising the state minimum wage to at least $9.50 per hour.
I’m hoping you’ll join with me in examining the ways the future of work is changing our lives every day. The stakes are high for all of us even if we make well over the minimum wage or are retired from working altogether. I hope that my daughters have opportunities that are better than my own, that they have access to jobs they love, and that they get to be part of an economy that is more equitable than it’s ever been. In the meantime, if you know any good babysitters, let me know. We are always looking. And you can ensure them: we pay over $9.50/hr.
— Chris Conry
