Saturday, June 09, 2012

Reminder: manufacturing jobs were not always 'good' jobs

At a Netroots Nation plenary panel this morning, labor leaders Ai-Jen Poo of the National Domestic Workers Alliance and Richard Trumka of the AFL-CIO each made variants of a fundamental point about the current American labor market.

As Trumka put it, manufacturing jobs -- steel jobs, auto industry jobs, etc. -- were not always "good" jobs.  Collective bargaining made them good. In the 1920s and 1930s, the position of factory workers was  analogous to that of service workers today.

Poo added that service jobs and "care" jobs are where the growth is  The demographic shift toward the elderly is as important as shifts in the country's ethnic makeup (and, she might have added, or may have implicitly, growing numbers of relatively young nonwhites are making their living caring for elderly whites.  The status and dignity of those jobs needs to be raised.

Richard Florida does a nice job putting these points in context.  Here's one iteration from a July 2010 op-ed:

The problem is that on average, service workers earn only half of what factory workers make – and only a third of what professional, technical and knowledge workers are paid. The key is to upgrade these jobs and turn them into adequate replacements for the higher-paying blue-collar jobs that have been destroyed.
It has happened before. Yet the blue-collar jobs we pine for were not always good jobs: we made them good jobs. When my father came back from the second world war, his poorly paid factory job had been transformed. He was able to buy a house, put his two sons through college and participate fully in the American dream. Some of this was due to the power of unions. Most of it was because of the enormous improvements in productivity wrought by improved technologies and management techniques.
If service workers are to be well paid, the country has to keep generating wealth by selling goods and services abroad. Seems like we don't have a problem with that; the problem is that our successful companies don't generate as many jobs at home as they used to, and their profits flow mainly to the top.  Can that wealth be shared without killing the golden geese?  That is, can the wealth generated by American companies be better distributed to benefit not only their own workers, but the growing number of service workers we all seem to require?

1 comment:

  1. I'm split on this.

    To Florida's point:

    "The key is to upgrade these jobs and turn them into adequate replacements for the higher-paying blue-collar jobs that have been destroyed."

    It's seductive to imagine that at least a healthy portion of our "lower-paying, low skill" jobs in the service sector could be improved in the same way the blue-collar manufacturing sector was transformed in the last century.

    But the problem there is that those factory jobs, specifically because of the "improvements in productivity wrought by improved technologies and management techniques," increasingly required at least a modicum of industry-specific expertise and training.

    Plus, those blue-collar jobs from the outset were much longer-term prospects for good employees--job tenure was on the order of decades. Average tenure in a low-skill service position today is a good deal shorter. And it will always be that way, because of the nature of service demand and other economic fluctuations. That can impose natural limits on wage and skill growth, regardless of other economic factors.

    The sector and its inherent conditions are very different from the blue-collar manufacturing sector of the 20th century.

    Florida identifies some reasons for optimism, specifically the fact that some large service corporations are seriously implementing new best practices, and the potential for "the public, private, and non-profit sectors to develop new strategies for upgrading service work."

    But because of the sprawling, heterogeneous nature of the sector, making any headway will require a kitchen-sink, all of the above strategy. And we all know how Americans these days just love to be told their problems can only be solved by rational, evidence-based, multifaceted measures *cough* ACA *cough*.

    Ahh, but therein lies a path forward, you say.

    When (if? damn you John Roberts) the exchanges are fully operational, millions of workers will achieve true health-care portability. They won't have to take, or keep, a job just for the health insurance. In normal economic times, this should help people more often seek out work that they are better suited for, or actually enjoy. That in itself could foster greater upward mobility.

    But pair that with a total elimination of the employer health-care subsidy, and you'd go a long way toward lifting *all* American jobs on a rising tide of wage increases, higher federal tax revenue plowed back in to ameliorative strategies, and debt reduction, and more robust GDP growth. You could even throw a bone to employers by reducing their Social Security obligation (while also lifting or raising the SS income cap). You'd most likely get a significant reduction in health-care "overuse" as a bonus.

    The "Cadillac Tax" is a small, backdoor path to weakening the employer subsidy. But it's not nearly enough. I think a targeted effort to eliminate the subsidy, on the grounds of strengthening the workforce (without relying on evil unions!), and specifically improving the future prospects of the 45% of us who comprise the service sector, could be a powerful, popular measure. (Although the Socialist Government-run Health Care hurdle would still exist.) And it's the kind of wonky, complex, bank-shot idea that the president seems to favor most. I kind of wonder if Orszag ever proposed it.