[As a courtesy to our guests, please keep comments to the book and be respectful of dissenting opinions. Please take other conversations to a previous thread. - bev]
Host, June Carbone:
The state of middle America can be tied to jobs. Once, good jobs – with security, benefits, a career ladder – were routinely available, at least for white males. A young man might finish school, find employment and stay with that company for the rest of his working life. Raises and promotions followed as a matter of course. The pay, even for the unskilled, could support a spouse and children. Health care benefits covered the family’s medical needs. Pension plans were typically defined benefit – once they vested, they guaranteed a fixed income no matter how the economy or the stock market performed. Unions served as a check on management efforts to demand too much, and both management and labor tended to work similar forty hour weeks. Employers invested in their employees’ training and skills and the employees, including both labor and management, often identified with the company.
These jobs, rooted in the manufacturing economy that followed World War II, are largely gone. Replacing them are some better jobs – particularly professional and technical positions that require more education and preparation but reward the employee with higher pay and the opportunity for greater creativity. The tech and medical sectors employ engineers, scientists, accountants, entrepreneurs, and sales staff who can create new and market e-books, IPods, videogames and the latest pain killers and cancer treatments. The new economy, however, also produces more “bad” jobs: positions that pay poorly, offer little job security, provide fewer benefits such as health or pensions, and offer employees less flexibility with respect to family needs or job performance. Wal-Mart and McDonalds immediately come to mind, but they may offer greater security and benefits than the contract agencies that supply home health care aides or family run restaurants and small businesses.
In his book Good Jobs, Bad Jobs Arne Kalleberg systematically documents the changes in the American economy. Think of a dimension of the American economy and it’s in the book. Wonder where Americans are working? Sales, Service (typically “bad” jobs) and Managers, Professionals and Technical Positions (typically “good” jobs) are up; precision production, operators, administrative support and crafts and repair (what used to be the middle) are way down. Want to know how the changes interact with the composition of the labor force? The percentage of Latinos in the labor force has steadily increased, from 5.8% of the total in 1980 to a projected 23.7% in 2050. On the other hand, the male labor force participation has steadily decreased since 1950 when 86.4% of males were employed or looking for work to a projected 66.8% in 2050. Concerned about job stability? Kalleberg looks behind the figures that show job stability holding steady to note that the averages cloak important differences: job stability increased for women while it decreased for men; and it held steady for college graduates while it decreased for the less skilled. Believe that Americans work harder than anyone else? Kalleberg provides evidence that more Americans work longer hours than thirty years ago, especially in good jobs, but also more Americans work less than forty hours a week. More Americans work more intensely, both in good jobs and bad ones, than thirty years ago; and more Americans report flexibility and control of work conditions, especially in good jobs.
Kalleberg also takes on the reasons for these changes. Though more measured than “Winner Takes All Politics,” which tied the changing jobs picture to political changes, Kalleberg agrees that the increased polarization in the work place is due to peculiarly American developments. While globalization has resulted in greater ability to shift production to low wage areas of the world, the impact on the American working class is greater than in other industrialized countries. Kalleberg clearly establishes that the causes lay with the decline of unionization, labor market deregulation, and the changes in the financial sector that emphasize short term profits at the expense of longer term investment in workers or company stability. One of the most striking charts in the book compares the growth of productivity with the change in wages. Productivity grows steadily from the early eighties through 2009, continuing upward even after the Great Recession. Median male compensation moves together with changes in productivity though the early eighties and then declines in the nineties and stays flat after 2000, even as productivity increases dramatically. American workers, especially men in “bad” jobs, no longer share in economic progress.
Kalleberg’s solution requires rethinking the social contract, a tough sell in individualistic America. He refers to the European concept of “flexicurity,” which seeks to combine employer flexibility with worker security. Doing so requires rethinking the relationship between public and private. The essential elements of such a model require universal, affordable, portable health insurance which ideally should be separated from employment. It also requires a more secure and portable pension system, more generous unemployment insurance, and greater opportunities to acquire new skills and education over the course of a lifetime. If employment is more transient and employers invest little in their workers, then a revitalized social safety net needs to fill in the gaps.
The book is sufficiently comprehensive that I hesitate to say that there is anything it does not address. Still, while the existing employment picture is comprehensively documented, many of the factors that affect the impact of these changes and the possibilities of reform receive limited treatment.
First is the corporate environment that transformed the American workplace. Kalleberg mentions the change in the financial environment, particularly the rise of institutional investors. He also addresses the change in executive compensation and the growth in wage inequality. Even so, he does not fully capture the extent to which CEO’s earn megabonuses by changing the corporate bottom line at the expense of both workers and long term corporate health. Recent books on pension systems, not to mention the financial crisis, show how executives can increase their own well-being through accounting changes and financial practices that increase the risks to everyone else, including their own companies.
Second, while Kalleberg certainly discusses the political climate that makes adoption of his proposed reforms unlikely, he does not engage in a systematic examination of the relationship between the increased concentration of wealth at the top and the political changes over the last thirty years. The book ends with an agenda for change, but not a political strategy on how to achieve it. The dramatic increase in the wealth of the 1% skews both the political and corporate environments. Kalleberg, while documenting the regulatory changes that have made management freer to shortchange the interests of workers, touches only lightly on the relationship between the two.
Third, Kalleberg acknowledges the relationship between changes in the family and employment without a systematic examination of the way they interact. In some ways, I’m relieved because that is the subject of my next book. Kalleberg devotes considerable attention to the growth of two earner families and the need for greater job flexibility. What receives less attention is the class-based nature of the changing family. The workers on the losing end of the employment picture are also the ones who have experienced the highest increases in divorce and non-marital births (for reasons I will argue are related to the employment changes). That means that the role of the family in cushioning the impact of layoffs, extended job searches, and retraining efforts reinforces the class-based inequality that the employment system produces. The result both increases the importance of a new social contract and raises far reaching questions about how such a contract is likely to interact with the changing families of the next half century.
Overall, Kalleberg’s analysis suggests that we have lived through a wholesale remaking of the foundation of the American workplace with profound implications for the health of our society. His low key and comprehensive documentation of these changes should inspire outrage at the consequences.