Has the United States Given Up on Good Jobs?
Former Treasury Secretary Larry Summers argues that the issue with the economy and inequality is “that there aren’t enough jobs” and any policy that helps one person or group of people get jobs will take away jobs from another person or group of people. Basically job hunting and searching is still a buyer’s market and we are in a zero sum game. Economic zero sum games tend to make people very nasty.
Over at Vox, Dylan Matthews believes that both Rand Paul and Hillary Clinton are saying that the future of jobs in America is going to be a crummy service jobs with low-wages and low-benefits. The only difference between the two is that Paul is going to encourage people to work by gutting the social safety net and Hillary Clinton is going to make crummy service jobs more bearable via a variety of programs like child-care subsidies and paid parental leave. Childless and/or Single people stuck in low-wage service jobs get screwed over because no one is daring to mention mandatory vacations or universal sick leave yet.
These issues are not quite new and have been kicking around since the start of The Great Recession in 2007-2008. Economist Tyler Cowen has written about his belief that the United States has eaten all the low-hanging fruit and we might be heading to a two-tier society. You will have a small group of people who earn a lot and large group of people who earn little or nothing. His book seems hyperbolic but Cowen also predicts the end of the social safety net and welfare state and seemingly a return to sustenance farming.
The issue is what happens to American Society if all of this is true and the answer is not pretty.
Defining a good job is impossible because people seek all sorts of things out of employment including prestige, status, and other psychic benefits. It is very hard to fill trade jobs because of the prestige issue. Many middle and upper-middle class families would still probably rather send their progeny to law school over being a plumber even if you told them that the plumber has a much higher chance of earning a 6-figure salary (I don’t know if this is true or not, just using it as a hypothetical.)
For the sake of argument, a good job will be one that provides a reasonable to good income, benefits (health insurance), chances for promotion or advancement (could be in-company or laterally), and two or three weeks of PTO every year.
Most jobs with these requirements seem to go to college graduates still. There are also many jobs that require large amounts of education that seeing fewer and fewer benefits like the adjuncitifaction of academia to the continued employment crisis in law.
Swifto is a start-up which requires their dog-walkers to have college degrees. I am not sure why it is necessary for dog-walkers to have college degrees. But the Tech community is clearly willing to isolate themselves from their surroundings. Maybe a college degree is now seen as a minimum level of competence but I can’t imagine people being willing to go into large amounts of debt if it means that they will end up as dog-walkers.
So what happens? Coding is already replacing law school as the go-to extra skill for arts and humanities graduates but this can also lead to supply outpacing demand.
I suspect if current trends continue, the United States will see a population decline because fewer people will decide to have children especially if they are college graduates and are suffering in the current economy or went through periods of low-wage and low-benefit work before finding their footing. People might just think it is a better choice not to have kids based on their situation and not wanting a child to go through the same thing.
What is harder to tell is whether and when people will decide not to go to college. There is something morally horrible about needing to go into massive amounts of debt to have a chance at a good job but it still seems that there are plenty of not great, crummy service jobs that can demand a college degree from prospective job applicants. This seems like an untenable situation but I have no idea what will improve it.
The question that remains is why do so many elites in both parties and academic elites like Tyler Cowen feel like we are entering an age where bad jobs are the norm instead of the exception and why this is just something to accept. I suspect that globalization is partially to answer and for the fact that large parts of the Democratic and Republican parties think that globalization is a force for good and that arguing for protectionism makes you a re horrible xenophobe. Yet everyone seems to be ignoring that a nation with lots of people in morale-destroying jobs is going produce incentives towards radical politics and solutions. Right now the center-left solutions are rather anemic because they focus on families. As I noted above, mandatory vacation for all seems to be a policy too far for the center-left to consider. The Republicans certainly aren’t going to propose it.
Dylan Matthews suggests that the time for Guaranteed Basic Income is now but I suspect that this is a non-starter in the United States (and most of the world). There is still a strong cultural incentive to work because for all of human history, not working equaled death. Even an absolute anti-Capitalist like Lenin believed that “Those who don’t work, don’t eat.” It takes a lot to overcome thousands of years of human experience and belief. I also suspect that guaranteed basic income is going to create resentments including among those who can and want to work for higher wages but don’t win the “good job” lottery especially if these people need to move to cheaper areas that they never wanted to live in. Guaranteed Basic Income is not going to make desirable places much more affordable.
These are probably issues that are going to take years or decades to unfold. I am not necessarily looking forward to them.