The future of jobs: An hourglass economy?
Kai Ryssdal: Seems to me if we’re going to talk a lot about jobs today, we’d do well to set the stage a bit. So here you go: 13.9 million people are unemployed in this country. About half of them have been looking for work for more than a year. Eight and a half million are part-timers — not by choice, they’d rather work more but can’t get the hours. Three million are what Bureau of Labor Statistics calls marginally attached — they want to work and are available but can’t find anything. About half of that group has stopped looking all together. And that’s only the folks on record with the official census.
Marketplace Scott Tong has spent some time this year looking at the future of jobs. Hey Scott.
Scott Tong: Hello Kai.
Ryssdal: So Scott, remind us how big is the jobs hole and what does it look like?
Tong: It looks a little like the number 12, and here’s what that means: By one measure, we need to create 12 million jobs in the U.S. economy to get back to pre-recession levels. And at a pace of about 200,000 new jobs per month, which is actually pretty good compared to what we’ve seen, it would take 12 years. So call it whatever you want — that’s quite a hole. But here’s what economists call the structural thing here: The jobs of tomorrow that we’re hopefully going to create will probably not look like yesterday’s jobs. A lot of labor economists say we’ve lost jobs in the middle, that is, that require middle skills, say they have a high school education but maybe not a full college degree, and they command middle wages.
Economist David Autor over at MIT says these jobs involve what a lot of what he calls “routine”: You attach a windshield on a car in a factory over and over again; you’re a bank teller; you’re a typist. Those jobs, he says, are gone for good.
David Autor: It raised the possibility that there will be missing rungs in the career ladder, if you will. If you think about good blue-collar production jobs or office administrative support jobs, those were often career occupations. They were things that offered stability and certainly a sustainable standard of living.
Ryssdal: Let me ask you this, though, Scott, and it’s basically technology replacing people instead of lower-wage workers overseas, and I get that. But the big question this week is how did we get here? What happened that made this change come?
Tong: This is the long story: Technology giveth, technology taketh away. It goes all the way back at least 200 years to England, when mechanical looms threatened human weavers, and we all get 10 points for remembering those are the Luddites. And in the American South, technology and railroads and electricity took good jobs from the Northeast — the expensive Northeast — to the cheaper South. Today, of course, we have the Internet technology, which challenges the old school middleman and the salesman, of course. Many say the big change began in the ’91 recession, when lots of these routine jobs in the middle didn’t come back when the economy came back. And now this is looking like the third straight recession that looks like that.
Ryssdal: So here’s the question for the next year in American politics: Where does job growth come from? How do you do that?
Tong: Labor economists look at what they see now, and they see growth at the top: as the doctors, software writers, petroleum engineers. And a lot of them at the bottom: home health care aides, dog walkers, people who mow lawns — the bottom of the income scale, and there are a lot of people who are chasing those jobs, so those wages aren’t going to go up very quickly. We risk oversimplifying, but a lot of people describe it as an hourglass economy, and that’s going to be what it kind of looks like for a while.
Ryssdal: What do you do then, Scott?
Tong: Well this is where we collide into politics. Many say we invest in education because there’s a lot of numbers that say a bachelor’s degree translates into a big and increasing wage premiums, is what they call it. A lot of countries are investing public dollars into new sectors where they hope a lot of these jobs in the middle are — biotech, clean tech, infrastructure — to shore up some of these jobs and create new ones going forward.
Ryssdal: Ambitious government programs at a time when government is getting less ambitious.
Tong: And that’s the question. There are a lot of programs, a lot of tax incentives that try to create these things, but we’re in a budget environment where, you know, those tend not to be on the table. So tough calls going forward.
Ryssdal: Scott Tong on the jobs picture for us. Scott, thanks a lot.
Tong: You’re welcome.
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