in archaeological order … derivative works on top, originals below
- U-Shaped pattern
- hollowing out
- New College Grads (NCG) do service jobs, not “knowledge work”
in archaeological order
- Josh Bivens, Elise Gould, Lawrence Mishel, Heidi Shierholz; Raising America’s Pay: Why It’s Our Central Economic Policy Challenge; Economic Policy Institute; 2014-06-04; x pages; landing, press release.
- Paul Beaudry, David A. Green, Benjamin M. Sand; “The Declining Fortunes of the Young since 2000″; In American Economic Review; 104(5); 2014; 381-86; regwalled.
- Andrew Sum, Ishwar Khatiwada, Mykhaylo Trubskyy, and Martha Ross with Walter McHugh, Sheila Palma (<snide>what a complicated attribution statement</snide>); The Plummeting Labor Market Fortunes of Teens and Young Adults; Brookings Institution; 2014-03-14; 28 pages.
- David Autor, David Dorn; The Growth of Low-Skill Service Jobs and the Polarization of the US Labor Market; In American Economic Review; 2013; 103(5); 1553-1597 (45 pages).
- Paul Beaudry, David A. Green, Ben Sand; The great reversal in the demand for skill and cognitive tasks; working paper; 2013-01; 70 pages.
- David Autor (MIT, NBER); The Polarization of Job Opportunities in the U.S. Labor Market Implications for Employment and Earnings; a commissioned work; Center for American Progress, The Hamilton Project; 2010-04; 48 pages.
Josh Bivens, Elise Gould, Lawrence Mishel, Heidi Shierholz; Raising America’s Pay: Why It’s Our Central Economic Policy Challenge; Economic Policy Institute; 2014-06-04; x pages; landing, press release.
The clear connections between wages, income, and living standards mean that progress in reversing inequality, boosting living standards, and alleviating poverty will be extraordinarily difficult without addressing wage growth. Indeed, converting the slow and unequal wage growth of the last three-and-a-half decades into broad-based wage growth is the core economic challenge of our time.
Slow and unequal wage growth in recent decades stems from a growing wedge between overall productivity and pay. In the three decades following World War II, hourly compensation of the vast majority of workers rose in line with productivity. But for most of the past generation (except for a brief period in the late 1990s), pay for the vast majority has lagged further and further behind overall productivity. This breakdown of pay growth has been especially evident in the last decade, affecting both college- and non-college-educated workers as well as blue- and white-collar workers.
This paper argues that broad-based wage growth is necessary to address a constellation of economic challenges the United States faces: boosting income growth for low- and moderate-income Americans, checking or reversing the rise of income inequality, enhancing social mobility, reducing poverty, and aiding asset-building and retirement security. The paper also points out that strong wage growth for the vast majority can boost macroeconomic growth and stability in the medium run by closing the chronic shortfall in aggregate demand (a problem sometimes referred to as “secular stagnation”). Finally, the paper argues that any analyses of the causes of rising inequality and wage stagnation must consider the role of changes in labor market policies and business practices, which are given far too little attention by researchers and policymakers.
Andrew Sum, Ishwar Khatiwada, Mykhaylo Trubskyy, and Martha Ross with Walter McHugh, Sheila Palma (<snide>what a complicated author attribution statement</snide>); The Plummeting Labor Market Fortunes of Teens and Young Adults; Brookings Institution; 2014-03-14; 28 pages.
Employment prospects for teens and young adults in the nation’s 100 largest metropolitan areas plummeted between 2000 and 2011. On a number of measures—employment rates, labor force underutilization, unemployment, and year-round joblessness—teens and young adults fared poorly, and sometimes disastrously. While labor market problems affected all young people, some groups had better outcomes than others: non-Hispanic whites, those from higher income households, those with work experience, and those with higher levels of education were more successful in the labor market. In particular, education and previous work experience were most strongly associated with employment. Policy and program efforts to reduce youth joblessness and labor force underutilization should focus on the following priorities: incorporating more work-based learning (such as apprenticeships, co-ops, and internships) into education and training; creating tighter linkages between secondary and post-secondary education; ensuring that training meets regional labor market needs; expanding the Earned Income Tax Credit; and facilitating the transition of young people into the labor market through enhanced career counseling, mentoring, occupational and work-readiness skills development, and the creation of short-term subsidized jobs.
David Autor, David Dorn; The Growth of Low-Skill Service Jobs and the Polarization of the US Labor Market; In American Economic Review; 2013; 103(5); 1553-1597 (45 pages).
We offer a unified analysis of the growth of low-skill service occupations between 1980 and 2005 and the concurrent polarization of US employment and wages. We hypothesize that polarization stems from the interaction between consumer preferences, which favor variety over specialization, and the falling cost of automating routine, codifiable job tasks. Applying a spatial equilibrium model, we corroborate four implications of this hypothesis. Local labor markets that specialized in routine tasks differentially adopted information technology, reallocated low-skill labor into service occupations (employment polarization), experienced earnings growth at the tails of the distribution (wage polarization), and received inflows of skilled labor.
Paul Beaudry, David A. Green, Ben Sand; The great reversal in the demand for skill and cognitive tasks; working paper; 2013-01; 70 pages.
What explains the current low rate of employment in the US? While there has substantial debate over this question in recent years, we believe that considerable added insight can be derived by focusing on changes in the labour market at the turn of the century. In particular, we argue that in about the year 2000, the demand for skill (or, more specifically, for cognitive tasks often associated with high educational skill) underwent a reversal. Many researchers have documented a strong, ongoing increase in the demand for skills in the decades leading up to 2000. In this paper, we document a decline in that demand in the years since 2000, even as the supply of high education workers continues to grow. We go on to show that, in response to this demand reversal, high-skilled workers have moved down the occupational ladder and have begun to perform jobs traditionally performed by lower-skilled workers. This de-skilling process, in turn, results in high-skilled workers pushing low-skilled workers even further down the occupational ladder and, to some degree, out of the labor force all together. In order to understand these patterns, we offer a simple extension to the standard skill biased technical change model that views cognitive tasks as a stock rather than a flow. We show how such a model can explain the trends in the data that we present, and offers a novel interpretation of the current employment situation in the US.
David Autor (MIT, NBER); The Polarization of Job Opportunities in the U.S. Labor Market Implications for Employment and Earnings; a commissioned work; Center for American Progress, The Hamilton Project; 2010-04; 48 pages.
Between December 2007, when the U.S. housing and financial crises became the subject of daily news headlines, and March of 2010, the latest period for which data are available, the number of employed workers in the United States fell by 8.2 million, to 129.8 million from 138.0 million. In the same interval, the civilian unemployment rate nearly doubled, to 9.7 percent from 5.0 percent, while the employment-to-population ratio dropped to 58.6 percent from 62.7 percent—the lowest level seen in more than 25 years. Job losses of this magnitude cause enormous harm to workers, families, and communities.
A classic study by economists Lou Jacobson, Robert LaLonde, and Daniel Sullivan found that workers involuntary displaced by plant downsizings in Pennsylvania during the severe recession of the early 1980s suffered annual earnings losses averaging 25 percent, even six years following displacement.2 The nonpecuniary consequences of job losses due to the Great Recession may be just as severe. Studying the same group of workers with the benefit of 15 more years of data, labor economists Daniel Sullivan and co-author Till Von Wachter3 show that involuntarily job displacement approximately doubled the short-term mortality rates of those displaced and reduced their life expectancy on average by one to one and a half years. Thus, long after the U.S. unemployment rate recedes into single digits, the costs of the Great Recession will endure.
Despite the extremely adverse U.S. employment situation in 2010, history suggests that employment will eventually return and unemployment will eventually subside. But the key challenges facing the U.S. labor market—almost all of which were evident prior to the Great Recession—will surely endure. These challenges are two-fold. The first is that for some decades now, the U.S. labor market has experienced increased demand for skilled workers. During times like the 1950s and 1960s, a rising level of educational attainment kept up with this rising demand for skill. But since the late 1970s and early 1980s, the rise in U.S. education levels has not kept up with the rising demand for skilled workers, and the slowdown in educational attainment has been particularly severe for males. The result has been a sharp rise in the inequality of wages.
A second, equally significant challenge is that the structure of job opportunities in the United States has sharply polarized over the past two decades, with expanding job opportunities in both high-skill, high-wage occupations and low-skill, low-wage occupations, coupled with contracting opportunities in middle-wage, middle-skill white-collar and blue-collar jobs. Concretely, employment and earnings are rising in both high- education professional, technical, and managerial occupations and, since the late 1980s, in low-education food service, personal care, and protective service occupations. Conversely, job opportunities are declining in both middle-skill, white-collar clerical, administrative, and sales occupations and in middle-skill, blue-collar production, craft, and operative occupations. The decline in middle-skill jobs has been detrimental to the earnings and labor force participation rates of workers without a four-year college education, and differentially so for males, who are increasingly concentrated in low-paying service occupations.