(MintPress) – If there’s one unifying factor for Americans of all walks of life, it’s the worry of a stubbornly high unemployment rate. Those who once complained about their jobs have been muted by those who complain about not having a job. But an overwhelming majority of Americans could have another gripe on their hands: They don’t have a “good job.”
A report by the Center for Economic and Policy Research (CEPR) concluded that based off the 2010 workforce in the United States, only 24.6 percent of all jobs in the United States were considered “good jobs.” The face of the American workforce is ever-evolving over the past 15 years, as college degrees no longer guarantee a quality job; underemployment has become an equally destructive problem as unemployment and corporate profits are growing exponentially while workers’ salaries remain stagnant.
To understand why the percentage of those holding “good jobs” has decreased, you first have to look at the criteria used by the CEPR to come to such as conclusion:
– The job must pay at least $18.50 an hour. According to the authors, that is the equivalent of the median hourly pay for American workers back in 1979 after you adjust for inflation.
– The job must provide access to employer-sponsored health insurance, and the employer must pay at least some portion of the cost of that insurance.
– The job must provide access to an employer-sponsored retirement plan.
The salary for a “good job” would pay $37,000 per year, a reach for many, as now more than 40 percent of jobs in America are considered low-income jobs. When compared to statistics from three decades ago, it seems as though the U.S. workforce is worse off, as less than 30 percent of all jobs then were low-income jobs.
Positive, negative trends
Various theories have sprung up since the recession in attempt to explain the decline in both workforce and quality jobs. One is that there are less qualified workers emerging from universities to fill highly skilled jobs such as engineering, technology and the sciences. But last year, 53 percent of all U.S. college graduates under the age of 25 faced unemployment or underemployment.
John Schmitt, a senior economist at CEPR and co-author of the group’s report, argued that the lack of qualified applicants argument was nonsensical because job losses as a result of the recession have hit workers with all sorts of skills and that no group, whether highly skilled or not, has been immune to staff reductions. The study found that 34 percent of all U.S. workers have a four-year degree in 2010, compared to 19 percent in 1979.
“If that were true and widespread, we’d see wages of workers rising, because employers would try to steal away qualified workers from other employers,” Schmitt said. “We’re not seeing that in the data — we’re not seeing an increase in wages relative to last year, or the year before, or before that.”
The CEPR argues that outsourcing profitable science-related jobs and union busting are the main culprits for the declining workforce and number of quality jobs available. In the 1970s, America drastically scaled back its manufacturing prowess by outsourcing jobs in steel manufacturing, electronics and automotive manufacturing to South America and Asia.
The trend of outsourcing is only beginning to reverse itself today, as President Barack Obama has repeatedly called for growing the manufacturing sector. Some companies have followed suit, by expanding operations in America and refusing to send more jobs overseas. Caterpillar Inc., the iconic manufacturer of machinery engines and turbines, is now expanding its operations in the U.S. by building a $120 million plant to build earthmovers in Victoria, Texas that will manufacture certain models typically designated to plants in Japan.
General Electric also opted to invest $93 million to renovate its plant in Bloomington, Ind. rather than expanding its operations in Asia. The company says the move will save 700 jobs in the U.S.
A more troubling trend for the CEPR is the reductions in workers’ unions across the country. According to the group, private-sector workforces that are unionized have fallen from 23 percent in 1979 to less than 8 percent today.
“We believe, instead, that the decline in the economy’s ability to create good jobs is related to a deterioration in the bargaining power of workers, especially those at the middle and the bottom of the income scale,” the CEPR wrote in its report. “The main cause of the loss of bargaining power is the large-scale restructuring of the labor market that began at the end of the 1970s and continues to the present.”
Public- and private-sector unions have been targeted alike, most often by Republicans and those on the right, who argue that the wages and benefits guaranteed to union workers have become too expensive for private business or the government to afford. The decline in workers’ unions has created a workforce that has far less negotiating leverage and say as it pertains to salaries and benefits.
Corporate gains
Despite the recession, many of America’s largest corporations are not only surviving, but thriving. In 2011, according to the Bureau of Labor Statistics, real wages fell around 2 percent. In turn, corporate profits totaled $1.97 trillion, the highest mark seen since the end of World War II.
Economists note that corporations have discovered that they can get by on the cheap by having fewer workers do the same amount of work as before and that hiring in a down economy has its risks. That mentality has created a catch-22 for economic growth: A growing economy relies on a heavily-employed workforce, but companies are refusing to hire workers because of the weak economy.
Aaron Smith, senior economist at Moody’s Analytics, told the Huffington Post that current business practices and continued high unemployment will continue to burden states that help with paying out unemployment benefits.
“The public sector is having to step in and fill that void,” Smith said. “If the labor share continues to decline and we keep throwing more government money at it when we’re on a clearly unsustainable fiscal path, what is the end game there? It’s not exactly rosy.”