Why American Workers Without Much Education Are Being Hammered

http://www.nytimes.com/2015/04/22/upshot/why-workers-without-much-education-are-being-hammered.html

by jacinda • 11 years ago

78 89 11 years ago

The point of the article is interesting, among those who have a job at all, managerial workers and independent professionals are making more money while the majority of workers are making less.

However while uneducated "workers" may be suffering, among the educated there are more and more "non-workers":

https://research.stlouisfed.org/fred2/series/LNS11327662

blfr• 11 years ago

The article doesn't mention immigration even in passing. Sure, there's globalization and improvements in technology but there are also millions of people increasing the supply of labour, especially for jobs that don't require much skill or certification.

fnordfnordfnord3• 11 years ago

Is there a corresponding increase in immigration over time? As far as I know (in my lifetime) there have always been migrant laborers.

humanrebar5• 11 years ago

Is there a corresponding increase in immigration over time?

Yes. The both the number and percentage of immigrants have doubled since 1990. I'm pro immigration, but it's odd that we aren't even talking about how immigration affects job prospects, especially given the dismal wages across the board.

humanrebar5• 11 years ago

And it doesn't mention that even the most educated workers are not keeping pace with real GDP growth.

The analysis basically books down to "supply exceeds demand, uneducated hardest hit". I would have liked to see more analysis on the ultimate reason for the lack of demand for workers.

Finally, it bugs me when people blame technology for destroying jobs and not society, employees, and employers for thinking simple, repetitive jobs are viable long-term career paths. Distilled to absurdity, we could pay people to dig holes and refill them, but robots will always be orders of magnitude better at that. Why blame the robot and not everyone else for not realizing hole-digger is a job with an expiration date?

RobertoG• 11 years ago

What are the jobs without an expiration date?

It's always funny how when these kinds of questions arise in HN a lot of people is worried about what are "we" going to do with "them" when "we" have not works for "them".

(not talking about the parent here, by the way)

tormeh• 11 years ago

Reasons for lack of demand:

-phase lag: It takes a while for the economy to find uses for increased labour.

-Until the above is fixed: Unbalanced levels of education: The economy requires x amount of elementary graduates per y amount of high school graduates per z amount of university graduates. Mostly unskilled immigrants don't come in these ratios and therefore introduces imbalance, meaning there's a surplus of unskilled workers

normloman2• 11 years ago

Few people think a repetitive, unskilled job is a viable career path. People take these jobs because they have no other choice. Not everyone can go to college.

steamy• 11 years ago

Why don't you take it one step further and question the viability of the model of work as one of the primary sources of "inspiration" and "core" aspects in life and that life should not be centered around this in light of the recent developments in the job market and technology?

Also, please debate why most humans have to work in the first place just to put food on the table while the 1% of Earth's population controlling ~40% of global wealth.

rhino369• 11 years ago

And it doesn't mention that even the most educated workers are not keeping pace with real GDP growth.

Should they be? Isn't a lot of rGDP growth caused by a growing population. Or is it not keeping up with rGDP/per capita.

spott2• 11 years ago

And it doesn't mention that even the most educated workers are not keeping pace with real GDP growth.

Doesn't this go away when you take into account benefits on top of salary?

eli_gottlieb3• 11 years ago

I would have liked to see more analysis on the ultimate reason for the lack of demand for workers.

The simple answer is: because state economic policy has been systematically configured to keep inflation low and asset values high. Any economist can tell you that low inflation and high asset values, as goals, conflict with full employment, and tend to suppress the price of labor. Somehow, it has become a Thing You Don't Say to actually admit this fact, because that would mean low wages are a social problem rather than an individual moral failure.

briandear3• 11 years ago

The NY Times wouldn't mention immigration because that would harm the Ehite House narrative about how 'good' it will be to open the borders and provide amnesty. The people that are most conditioned to vote democrat (the poor) are the ones who are ultimately harmed the most from increasing immigration and reducing deportations. However by increasing immigration, presumably the Democrats think that they will add enough votes to offset the potential loss of votes from the existing American lower classes who are most profoundly harmed by illegal immigration and the so-called 'path to citizenship.'

In terms of immigration policy, one might want to ask oneself why tech companies want to increase H1s; why people like Zuckerberg care about the immigration issue at all. It isn't because of some altruism. More immigrants mean declining labor costs. This article exposes the canary of the lower wage segments, however a similar pattern will eventually emerge in the higher wage fields as well.

01Michael102• 11 years ago

The NY Times wouldn't mention immigration because that would harm the Ehite House narrative about how 'good' it will be to open the borders and provide amnesty.

I didn't realize the NY Times was an operative of the Obama administration...

anthony_romeo• 11 years ago

But if one provides amnesty, then these individuals would likely have to pay payroll taxes and be paid a normal wage, instead of hiding from the system and getting paid under the table. Anyway, it's employers hiring illegally that's the problem. Immigrants wouldn't be coming here and 'stealing' jobs if employers were not complicit in the matter.

nova22033• 11 years ago

Mark Zuckberg is worth 34.8 billion $. How much money do you think he saves by hiring "cheaper" H1B workers?

twoodfin• 11 years ago

I agree it's a glaring oversight, but I don't think it's a supply/demand effect so much as a demographic shift: I'd bet that the group of American working men ages 30-45 without a high school diploma now tilts much more heavily first-generation immigrant than it did in 1990. The percentage of native born Americans with high school diplomas has risen pretty consistently over that period, and immigrants as a % of the population has been spiking since 1970, rising from 8% to 13% from 1990-2013.[1]

As the Census Bureau pointed out in 2003:

The percentage of the foreign born with a high school diploma (67 percent) was dramatically lower than that of the native population (88 percent), but paradoxically, the percentage with a bachelor's degree was the same (27 percent).[2]

I don't think it's outrageous to suggest that first generation immigrants may have less remunerative employment opportunities than native born citizens, regardless of their education level, but particularly without a high school diploma.

[1] http://www.migrationpolicy.org/programs/data-hub/charts/immi...

[2] http://en.wikipedia.org/wiki/Educational_attainment_in_the_U...

adjwilli2• 11 years ago

And it doesn't mention civil rights or feminism either. There may be various cultural phenomenons that play a part in increasing the labor supply, but enforcing barriers to entry disregards the dignity of people. The fact is, if you want to be materially successful in life you have to compete (at least in some way) with everyone you share the Earth with. You can't stop immigration any more than you can stop oppressed people from wanting to be free. The point of the article is though to remind us educated NYTimes readers that while we might be sitting pretty, there are certain classes of society who are getting left behind.

yummyfajitas• 11 years ago

The fact that lowering barriers to entry (by people unfortunate enough to be born black, female or foreign) is a normative good does not mean that an article should ignore them - they are still possible positive causes of low income workers "getting hammered".

If they are a primary cause, then the correct response is just to accept that good things may have tradeoffs.

mc323• 11 years ago

Curiously the media typically are against immigration of the professional classes, think doctors, lawyers, journalists, accountants, etc. but typically are in favor of uneducated immigration -now industry wants both because it makes the labor supply cheaper, activists typically only look after the uneducated immigrant pool and hardly care about fighting for immigrant professionals.

As an aside, Japan but not Britain does a "good" job at limiting immigration despite the great need for it within their economy. Their bet is that the pain to their economy is worth the stability of their society. I suppose we shall see who has the better answer an open economy like the UK or a closed labor economy like Japan.

Also, this not a phenomenon unique to rich western countries, south Africa, Nigeria, Kenya are also very keen on protecting their own labor markets from immigrant classes. There is a protectionist aspect but its not racial in nature. Look at the Mexican motto "Mexico for Mexicans" and how other Hispanics are unfavored in their economy. Imagine a European country having a similar motto...

ck2• 11 years ago

The trade deal Obama really wants to sign is going to put the final nail in the uneducated worker's coffin. Every remaining low wage job that can be exported, will be exported. The rest will be automated as much as possible.

Then we are going to have this weird culture where the people serving you food have college degrees and are desperately trying to pay off student loans. Meanwhile everyone else will think they can just make a startup or small business to survive but there will be so many copycats the customer base will be too fractured.

We better discover nearly free power soon or things are going to get ugly for the 98% in the next decade.

fnordfnordfnord3• 11 years ago

If we really go that route, the whole thing will fall apart soon after food becomes unaffordable. Most of us are not moral enough to starve.

ddorian43• 11 years ago

Then you'll have just enough food? Or the military-police ?

briandear3• 11 years ago

The legalization of millions of illegal immigrants is really going to seal the deal.

kfk2• 11 years ago

It is worth mentioning that an economy that produces higher added value will have a fallback on the lower classes too. While the delta in wealth between the rich and the poor has been increasing, in relative terms the poor have been getting richer. A poor today is way better than a poor 50 years ago or even 20 years ago. If you are concerned about what poor people can do, then think to all those products that now are too expensive but that a future richer society might want. For instance, in Germany (richer country than mine), is very normal to buy local/bio/laborIntensive goods like traditional food and so on, this is all stuff that non educated people can do and will do in the future.

mistermann• 11 years ago

I generally agree with this, but in some locations an exception to this is real estate, in that a growing subset of the market are becoming increasingly priced out of ever buying anything. Interestingly, the US for the most part is not currently suffering from this due to the bursting of the housing bubble.

danans3• 11 years ago

An area where the poor in the US are frequently worse off than in the past is in access to quality education for their children, which then holds families and communities in multi-generational poverty, and reinforces the trends described in the article.

When I was young, a unskilled laborer's child had access to the same or similar quality schools as I did (although I had much bigger advantages in culture by having educated parents). Today, the working poor in the US are often "richer" in shallow ways - they can buy a smartphone and a big TV - but they are less able than ever to afford a good education for their kids, usually because they simply cannot afford a home in a good school district.

marincounty• 11 years ago

I don't know what's in TPP--it's supposedly classified. The little that slipped out is troubling though.

I think the next decade is going to be tough for most people including the highly educated.

I would like to stem the flow of jobs drifting overseas, but don't feel confident. Programmers, even the ones with degrees are going to be hit hard. There's not to many white collar professions a hungry, intelligent person in another country could not master over the Internet--more easily than programming, and website developement?

I hope this TPP is not as bad as it seems? I sometimes think Obama knew the party was over? I saw the desperation in his face when he felt he couldn't convince Americans they need health insurance. He knew the president really couldn't change the economy, but he knew we needed health coverage. (Coverage that would protect the family home from hospital litigators--if an uninsured family member got sick).

I wish us well, but am scared. I do wish Bush let the banks fail. That cd with .1 percent is frighting. These low rates helped the economy, but really hurt guys like me. Guys who couldn't gamble in stocks.

I am giving Obama the benefit of the doubt on this trade agreement. If it's as bad as some say; Trump might have a shot at president if he is serious about his reversing the trade imbalance, and bring America back to a manufacturing Country?

On the minimum wage; I feel Obama sees the writing on the wall--the future will be bleak. The rich will have disposable income. The rich will still need to eat, buy, and hire security guards, etc. There will be great inflation. Why not get ahead of the game and raise the minimum wage? It might help out the majority(including the educated, whom don't come from benevolent wealthy families) get a little bit ahead?

I wish I moved to France in the late 80's. I had a shot, but was afraid.

bruceb2• 11 years ago

Trump might have a shot at president if he is serious about >his reversing the trade imbalance, and bring America back to >a manufacturing Country?

Trump is no friend of the working man/woman and has 0% of being president.

danielweber2• 11 years ago

What are the low-wage jobs that are currently protected that TPP would open to competition?

Shivetya• 11 years ago

Having worked for a security company; rent a cops; I was surprised by the types of people who took up the job. While there is a good amount of turnover there are many who are there for life. Most had a high school diploma and some had more. We did have college kids working their way from school, sitting at a post and doing periodic walks does lend time to study and it wasn't discouraged.

At first I was concerned because one of my jobs was to insure that payroll checks were printed on time and delivered to sites by payday or when required by law; terminations and those who quit in some states are required to be paid within a set amount of time. Having talked to only a few I found many simply liked the job because a) it was easy, b) schedules were nearly fixed, and c) the uniform imparted a sense of import. I never really ran into anyone I wouldn't want to have watching over a site. Those types tend to self weed themselves out.

Even in a day and age of automation there is still the comfort level many get from having a person about. Not all guards are low paid but many are.

Immigration reform will hit many sectors hard; likely the security sector as well. So the question becomes, how do you lessen the burden of all the fees for government services these people have to pay? We might not be able to legislate their pay to a level everyone is happy about but there are many costs of living imposed by government that could be restructured based on income.

hollerith• 11 years ago

What fees for government services do you refer to?

zo13• 11 years ago

I believe he's referring to Taxes.

briandear3• 11 years ago

Is there causation between no high school diploma and lower wages? They are certainly correlated.

njharman• 11 years ago

I always assumed (and still believe) they are both (lack of eduction, lack of well paying employment) are both results of other root causes. In other words if you couldn't make it through high-school or college (for whatever reason, ability, environment, access, attitude, etc) then whatever those reasons are make you also unable to acquire and keep a decent job.

zo13• 11 years ago

"[..]then whatever those reasons are make you also unable to acquire and keep a decent job."

And unfortunately for them, it doesn't keep them from inflicting the same life-outlook on their offspring. Greatest tragedy of our society, that we overlook that.

adjwilli2• 11 years ago

I don't know if it's as simple as it being always being either causation or correlation. Education level is used as a proxy of potential wellbeing indicators.

Yes, there are rare people who have never finished high school and had material success, probably most drug dealers who cashed out and bought franchises or real estate. So logically then general causation is ruled out.

But for most people without high school degrees it's extremely difficult to disassociate their lack of education with later material success.

danielweber2• 11 years ago

50 years ago it wasn't that weird to find a person with a good combination of smarts and work ethic who just happened to not graduate from high school, for whatever reason. The lack of a HS diploma isn't necessarily a stain.

In the year 2015, graduation from high school is a much easier in almost all ways. If you can't manage to graduate there is something seriously wrong and I probably don't want to hire you.

This is why I'm always terrified of trying to push more and more people through educational hoops: the ones who don't make it are that much more weird and excluded.

deedubaya6• 11 years ago

Maybe the correlation isn't education => low paying jobs, but motivation => low paying jobs?

I've seen a lot of people just "settle" with a crappy job which pays poorly just because they aren't motivated to go find something better or more challenging on a day-to-day basis. Some of these people have gone through college, some haven't.

deedubaya6• 11 years ago

Whoa, why the downvotes? Did I strike a nerve?

WalterSear• 11 years ago

You didn't contribute anything useful to the discussion.

jellicle• 11 years ago

You can see that the population gets these sudden bursts of laziness over time, which oddly are correlated with the business cycle:

http://www.ritholtz.com/blog/2010/03/an-epidemic-of-laziness...

Lazy takers!

deedubaya6• 11 years ago

I knew something like this would be a reply, of course.

I'm not talking in absolutes. I'm just suggesting that the correlation that the article assumes is correct may not be the only reason based off of my personal observations, that's all.

snowwrestler4• 11 years ago

The above will be a controversial post because there are plenty of highly motivated people who work hard but never get rich. For example a day laborer construction worker has to get up very early, perform tiring physical labor all day, and then do it again the next day. Many work more than 5 days per week to make ends meet. I bet that not many web developers could make it as a day laborer for long!

That said, the question of "motivation" now has a deeper subtext thanks to recent research on early childhood development and the impact of family and community on each individual's development and achievement.

Rather than an inherent personal quality (which is easily corrupted into a proxy for "worth" or "deserving"), we are learning that motivation is heavily influenced by factors outside a child's control, like how much loving attention they receive, how many words they hear per hour, the level of violence they witness or experience, the number of books in their home, the professional success of their parent or parents, the average socio-economic level of success in their school district, etc.

So, to say that maybe the answer is motivation, is not as much of an answer as it used to be. Now we want to know where motivation comes from, and what we can do to improve that.

deedubaya6• 11 years ago

So, to say that maybe the answer is motivation, is not as much of an answer as it used to be.

Definitely. It's sad that these outside factors influence something so important, but that doesn't change the fact that some people are motivated and some are not, does it?

dataker2• 11 years ago

The article should be named' Why Blue-Collar Workers Are Being Hammered'.

The matter of the fact is that in most blue-collar jobs, salaries stagnate after years of experience.

Having an education only do 2 things:

- Gives one the ability for a white-collar job

- With the same stagnation, blue-collar salaries become 'higher' and most workers are complacent about it

genericresponse• 11 years ago

It's the same for the bulk of white collar workers as well in most industries, they just stagnate later.

peterfirefly• 11 years ago

I think that was what dataker meant (but I'm not quite sure):

- With the same stagnation, blue-collar salaries become 'higher' and most workers are complacent about it

dataker2• 11 years ago

White collars have always had better salary growth than others.

Generally, blue-collars rely largely on 'manual labor' and, therefore, after its peak productivity, they hit a depreciative tendency(younger employees/outsourcing/...) .

White collars rely largely on networking and influence, hence its 'productivity' continues to grow.

The more 'manual work' one performs, the smaller his salary growth is.

CodeSheikh2• 11 years ago

Min wage should be increased by certain significant percentage but definitely not by 100% to $15. That is basically saying "no need to study in high school or go to college because you can still make around 30k based on min wage". 30k is a starting salary for a lot of college fresh graduates. This could in-return can also create economic imbalance among classes (abridging the gap between high school drop out and fresh college graduate)

danans3• 11 years ago

Local minimum wages should be raised in a manner commensurate with local inflation. In places like the Bay Area and NYC, $15/hr isn't much considering the enormous cost of living - hence the term "living wage".

$15/hr is probably too high for a part of the country with a very low cost of living like Mississippi.

The federal minimum wage sets the absolute bare minimum.

The often mentioned radical alternative is Basic Income, which would eliminate all minimum wages and push up wages on the low end by tightening the labor market (because many on the low-income end of the labor spectrum would opt not to work).

CodeSheikh2• 11 years ago

btw..why on the earth this article is on HN?! Are people comparing tech worker salaries as an ideal model for the entire economic class? I am confused by the upvoters here.

randomdata2• 11 years ago

There is always infighting on HN of whether a degree is important for being a developer. As such, anything that paints education in a positive, or negative, light will reach the front page.

NTDF93• 11 years ago

Are we really this Myopic?

Americans think that they deserve a certain standard of living. Why? Why do you deserve it? I don't see a good answer to this.

For a country emphasizing competition and capitalism so much, I find it hilarious when Americans start complaining about being out-competed (by other countries or by college grads or by smarter people).

The reality is that, in society, not everyone can get everything. The real issue is with glamorizing excessive profits.

Also, we can't expect only the good parts of globalization. If we want $10 t-shirts made by a worker in Bangladesh, we had better be prepared to lose the job to them. They are doing it cheaper and better than entitled us.

There's a solution! Tax the rich (and corporations) more and redistribute wealth in a fair way that creates more local opportunities, but we know where this discussion goes.

eli_gottlieb3• 11 years ago

Americans think that they deserve a certain standard of living. Why? Why do you deserve it? I don't see a good answer to this.

Because they built a society that can provide it. To everyone.

A good life for people is the goal. The terminal goal. You don't have to justify doing good for people; you have to justify making their lives worse.

NTDF93• 11 years ago

> Because they built a society that can provide it. To everyone.

That society was built on exploiting global resources and issues eg: selling weapons for wars, extracting oil, gold and diamonds from countries with uneducated leaders, manufacturing stuff from countries where living wage is lower aka making lives worse.

Just think about it! When those other countries start becoming more and more educated and start turning things for their own good, this great American society is going to have to suffer.

Let's say there are two people (American and Chinese) in this world and one t-shirt manufactured. The American was always able to afford it. Now the Chinese can afford it and can outbid the American. Doesn't the standard of living of the American drop? Yes.

Why American Workers Without Much Education Are Being Hammered

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