There are plenty of news commentators who think America’s workers are doing fine.
They see low consumer prices, low unemployment, and a booming stock market as signs that all is well. But out in the real world, things are more worrying.
Millions of Americans are barely subsisting on retail work in shopping malls and restaurants. The kinds of jobs available to them have declined in quality in recent decades.
Since 1990, the United States has been creating an overabundance of low-quality service jobs. In fact, new research shows that 63% of the production and non-supervisory jobs created in the U.S. over the past 30 years have been in low-wage and low-hour positions. That’s a major change from the start of the 1990s, when almost half of these jobs – 47% – were considered “high-wage.”
For more than a year, a group of economists have been sifting through the nation’s jobs data. And what they’ve found in a new “U.S. Job Quality Index” (JQI) is that in the past three decades, the U.S. economy has grown increasingly dependent on jobs that offer fewer hours of work – and at lower relative wages.
That includes almost 15 million non-management jobs in leisure and hospitality paying an average of $360 a week, and 13.5 million retail jobs paying roughly $506 weekly.
There are now 105 million production and non-supervisory jobs in the U.S. – 83% of all private sector work. More than half of them pay less than the average weekly U.S. wage of $793. These are the best jobs that many Americans can find, and the most hours they can get.
So what caused all of this?
From 1970 to 2019, manufacturing employment declined from 22.6% of the U.S. economy to only 8.2%.
These lost manufacturing jobs were replaced with lower-wage work – and at reduced weekly hours.
Where manufacturing once provided skilled, good-paying work – including benefits and health care – Americans lacking a college degree now find themselves becoming progressively more underemployed.
Almost two-thirds of America’s workforce – 65.1% – do not have a college degree.
And so, 100 million Americans are watching their employment prospects gradually deteriorate.
There’s no easy fix for this.
But the priority should be to restore wealth-generating industries, such as manufacturing, that can spur middle-class job growth. That will mean tackling predatory trade with China, and fixing an overvalued dollar so that American-made goods become globally competitive again.
These are necessary steps to create large numbers of jobs that can provide a path to the middle class. Anything less will mean an ongoing decline for America’s workers – and lower-quality jobs.