The Low-Wage Recovery and Growing Inequality

This report updates NELP's previous analyses of job loss and job growth trends during and after the Great Recession. We find that:1. During the recession, employment losses occurred throughout the economy, but were concentrated in mid-wage occupations. By contrast, during the recovery, employment gains have been concentrated in lower wage occupations, which grew 2.7 times as fast as mid-wage and higher-wage occupations. 2. The lower-wage occupations that grew the most during the recovery include retail salespersons, food preparation workers, laborers and freight workers, waiters and waitresses, personal and home care aides, and office clerks and customer representatives.3. The unbalanced recession and recovery have meant that the long-term rise in inequality in the U.S. continues. The good jobs deficit is now deeper than it was at the start of the 21st century.4. Industry dynamics are playing an important role in shaping the unbalanced recovery. We find that three low-wage industries (food services, retail, and employment services) added 1.7 million jobs over the past two years, fully 43 percent of net employment growth. At the same time, better-paying industries (like construction; manufacturing; finance, insurance and real estate; and information) did not grow, or did not grow enough to make up for recession losses. Other better-paying industries (like professional and technical services) saw solid growth, but not in their mid-wage occupations. And steep cuts in state and local government have hit mid- and higher-wage occupations the hardest.In short, America's good jobs deficit continues. Policymakers have understandably been focused on the urgent goal of getting U.S. employment back to where it was before the recession (we are still missing nearly 10 million jobs), but our findings underscore that job quality is rapidly emerging as a second front in the struggling recovery

Domestic Outsourcing in the United States: A Research Agenda to Assess Trends and Effects on Job Quality

The goal of this paper is to develop a comprehensive research agenda to analyze trends in domestic outsourcing in the U.S. -- firms' use of contractors and independent contractors -- and its effects on job quality and inequality. In the process, we review definitions of outsourcing, the available scant empirical research, and limitations of existing data sources. We also summarize theories that attempt to explain why firms contract out for certain functions and assess their predictions about likely impacts on job quality. We then lay out in detail a major research initiative on domestic outsourcing, discussing the questions it should answer and providing a menu of research methodologies and potential data sources. Such a research investment will be a critical resource for policymakers and other stakeholders as they seek solutions to problems arising from the changing nature of work

The Gloves-off Economy: Workplace Standards at the Bottom of America\u27s Labor Market

[Excerpt] The goal of this volume is to map the landscape of gloves-off workplace strategies, to connect them to the erosion of norms farther up in the labor market, to identify the workers most vulnerable to these practices, and finally and perhaps most importantly, to identify the ways that the floor under job standards can be rebuilt. In what follows, we first explore conceptual tools for analyzing evasions and breaches of workplace standards and then briefly review evidence about the scope of the problem. We next trace the historical trajectory that first led to the upgrading of workplace protections, then to the partial undoing of the protective web of laws and standards—using this narrative as well to introduce the contents of the volume. We close by considering strategies to put the gloves back on in order to re-regulate work

Memorandum: Data Needs for Research on Domestic Outsourcing in the United States

Available evidence points to substantial growth in U.S. firms’ outsourcing of various functions to domestic as well as foreign suppliers, a phenomenon sometimes called the vertical disintegration of the firm. Although receiving less attention than its offshore counterpart, domestic outsourcing is changing how work in the U.S. is organized across firms and industries. Good data allowing documentation of such supply networks is critical to the accuracy of many analyses, including employment impact analyses of a wide range of federal, state, and local economic policies; occupational workforce projections; and sector and industry productivity statistics. Moreover, although there are many reasons why firms outsource tasks, domestic outsourcing may be an important mechanism by which some firms cut labor costs including compensation, thereby contributing to the growth in earnings inequality. Yet, large data gaps limit the ability to conduct research on how outsourcing is changing the organization of work and affecting workers’ earnings and other aspects of job quality. In this memo, we offer strategies to improve the data to document and analyze the prevalence of domestic outsourcing in the U.S. and its effects on wages and other measures of job quality. The memo builds on a white paper we recently released with our co-authors Rose Batt and Eileen Appelbaum, Domestic Outsourcing in the U.S.: A Research Agenda to Assess Trends and Effects on Job Quality

The Impact of Oakland's Proposed City Minimum Wage Law: A Prospective Study

The Lift Up Oakland Coalition, an alliance of community, labor, small business, and faith organizations, has placed an initiative on the Oakland November 2014 ballot that would establish a minimum wage of $12.25 for businesses in the city starting March 1, 2015. This study examines the effects of a$12.25 minimum wage on Oakland workers and businesses. Drawing on a variety of government data sources, we estimate that more than a quarter of the Oakland workforce would benefit from the proposed policy, with the average worker earning an additional $2,700 a year. Our analysis of the existing economic research literature suggests that businesses will adjust to modest increases in operating costs through reduced employee turnover costs, improved work performance, and a small, one-time increase in restaurant prices

It's Not Just the ATMs: Technology, Firm Strategies, Jobs, and Earnings in Retail Banking

The authors examine trends in job content and earnings in selected jobs in two American banks. Firm restructuring and technological changes resulted in higher earnings for college-educated workers. The banks followed different strategies in implementing these changes for lower-skill jobs, with different effects on bank tellers in particular. The authors conclude that technology enables workplace reform but does not determine its effect on jobs and earnings; these effects are contingent on managerial strategies. This focus on organizational processes and managerial strategy provides a complementary approach to accounts of growing inequality that center solely on the role of individual skills and technological change.

An Overview of the Gloves-Off Economy: Workplace Standards at the Bottom of America’s Labor Market

When we talk about the “gloves-off economy,” we are identifying a set of employer strategies and practices that either evade or outright violate the core laws and standards that govern job quality in the U.S. While such strategies have long been present in certain sectors, such as sweatshops and marginal small businesses, we argue that they are spreading. This trend, driven by competitive pressures, has been shaped by an environment where other major economic actors—government, unions, and civil society—have either promoted deregulation or been unable to contain gloves-off business strategies. The result, at the start of the 21st century, is the reality that a major segment of the U.S. labor market increasingly diverges from the legal and normative bounds put into place decades ago

Domestic Outsourcing in the United States: A Research Agenda to Assess Trends and Effects on Job Quality

The goal of this paper is to develop a comprehensive research agenda to analyze trends in domestic outsourcing in the United States—firms’ use of contractors and independent contractors—and its effects on job quality and inequality. In the process, we review definitions of outsourcing, the available scant empirical research, and limitations of existing data sources. We also summarize theories that attempt to explain why firms contract out for certain functions and assess their predictions about likely impacts on job quality. We then lay out in detail a major research initiative on domestic outsourcing, discussing the questions it should answer and providing a menu of research methodologies and potential data sources. Such a research investment will be a critical resource for policymakers and other stakeholders as they seek solutions to problems arising from the changing nature of work