Where Have All The Good Jobs Gone?


The Economic Policy Institute today releases online the 12th edition of its invaluable survey text, The State of Working America, by Lawrence Mishel, Josh Bivens, Elise Gould, and Heidi Shierholz. EPI is a liberal nonprofit, but its economic analysis is respected by mainstream academic economists who follow trends in employment, income, and income inequality, and the new volume, like previous editions, is full of interesting information and persuasive analysis. (My only quibble would be that it ought to include educational failure among the government-caused—or at least government-unsolved—problems contributing to income inequality. Like EPI, I consider the U.S.’s elevated income inequality relative to other nations to be largely the result of government policy.)

One chart that in particular caught my eye is this one, showing the disappearance of good jobs as income inequality has risen over the past 33 years:












The State of Working America, 12th edition, Economic Policy Institute

What’s a good job? The EPI, borrowing criteria from John Schmitt and Janelle Jones of the Center For Economic and Policy Research, says it’s any job that pays at least $18.50 per hour (the median hourly wage in 1979, adjusted for inflation); offers health insurance (as 39 percent of all employers today do not; those that do make it available to most but not all employees); and offers some kind of retirement plan (in small companies, that’s half the workers; in medium-sized companies, 79 percent; and in large companies, 86 percent). Neither the health care nor the retirement coverage has to be especially good, and if you work full time a “good” job can be one paying as little as $38,480 per year (which, for the record, is well above the median wage). If you’re above the age of 30 then the odds are (if I understand TNR’s demographics correctly) that this is not a job, dear reader, you’d likely take. (Important caveat: You’d probably take it if the job was to work at TNR, but let’s not get distracted by the quirkily dismal economics of print journalism.)

As usual, the news is especially bad for men. In 1979, 37 percent of the jobs held by men were good ones; today, only 28 percent are. The news is better for women (many fewer of whom started off with, or today possess, good jobs). From 1979 to 2000 the percentage of jobs held by women that were “good” nearly doubled, from 12 percent to 21 percent. You’ve come a long way, baby! Unfortunately, in the crappy 21st century economy women have remained stuck at 21 percent (while men have lost more ground, going from 32 to 29 percent). The punch line is that since 1979 output per worker has increased by 48 percent. The more productive American workers get, the lousier their jobs get.

Mishel, Bivens, Gould, and Shierholz (like Schmitt and Jones before them) point out that this has all been happening as the workforce has become more experienced (i.e., older) and better-educated. In the ordinary course of events, that would mean the good-jobs percentage would go up, not down. Also? The aging of the population, and the consequent rising percentage of retirees, ought to be lowering the unemployment rate, but it isn’t. If the age distribution were unchanged since 1979 (when the Baby Boom owned the culture), then instead of peaking at 10 percent in 2009, unemployment would have peaked at 11 percent, thereby exceeding a post-Great Depression record previously set in 1982.

That’s why we call it the Great Recession, and not just the Pretty Good Recession.

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