The Pay Is Too Damn Low

[the_gneech]

The New Yorker: The Pay Is Too Damn Low (Hames Surowiecki)

Still, the reason this has become a big political issue is not that the jobs have changed; it’s that the people doing the jobs have. Historically, low-wage work tended to be done either by the young or by women looking for part-time jobs to supplement family income. As the historian Bethany Moreton has shown, Walmart in its early days sought explicitly to hire underemployed married women. Fast-food workforces, meanwhile, were dominated by teen-agers. Now, though, plenty of family breadwinners are stuck in these jobs. That’s because, over the past three decades, the U.S. economy has done a poor job of creating good middle-class jobs; five of the six fastest-growing job categories today pay less than the median wage. That’s why, as a recent study by the economists John Schmitt and Janelle Jones has shown, low-wage workers are older and better educated than ever. More important, more of them are relying on their paychecks not for pin money or to pay for Friday-night dates but, rather, to support families. Forty years ago, there was no expectation that fast-food or discount-retail jobs would provide a living wage, because these were not jobs that, in the main, adult heads of household did. Today, low-wage workers provide forty-six per cent of their family’s income.

In other words, we've got an entire nation trying to make a living on what was never intended to be a living wage. It's not now, nor has it ever been, that "the poor aren't working hard enough." They're knocking themselves out and not deriving any benefit from it.

-The Gneech

Comments

[sirfox.livejournal.com]

the wealth of the middle class has been systematically extracted by the rich. In graphs charting inflation-adjusted income, right at 1975-80, something happens. From that point on, mean worker pay has been stagnant, while corporate profits have continued to steadily grow.

http://marginalrevolution.com/wp-content/uploads/2011/06/MaleMedianIncome.png

Where did it go? it largely comes out of concessions made by workers when company owners threaten to move operations overseas, or from the loss of those jobs when the owners do anyway. ( The official sounding but entirely self-appointed and unaccountable Chamber of Commerce promoted legislation that made doing so not just profitable, but nearly required to keep up with competition. They like sounding official, but they're really one of, if not THE Biggest lobbying group in the country. )

The Hedge fund SAC just got charged with insider trading. not a member, but the whole damned hedge fund. Bank of America just got charged with knowingly selling off hot-potato grade F- quality loans as prime investment material. I'm glad we're finally charging some of these folks and sending them to jail for tanking the economy to line their own pockets. We have seen time and time again that there is no realistic expectation of basic human decency, good judgement, or any moral accountability at all from our financial institutions. With that in mind, it's hard not to shout when i hear politicians saying that we have too MUCH oversight and regulation.

All of this is a long-winded way of saying that if things continue as they are, we're looking at a society terribly reminiscent of the industrial age robber barons. The government intervening in business is far from the most efficient, equitable, or best way to make sure we don't go there. However, the last 30 years of economic evidence say that we sure as hell can't trust businesses alone to get us out of a situation that their own lobbying perpetrated, because it's all working out very well for them.

at least it is for now... There's an even messier and uglier solution which history tells us has popped up time and time again when people get squeezed too hard, and say "no more.", and that's Revolution.

I seem to have come over all Marxist. I need to go to bed.

[galadrion.livejournal.com]

Before you get too hot and bothered about "Big Business" and their corrupt practices, you might want to take a look at why those practices have come about. Most of the questionable banking practices of the last 35 years, for example, are a direct result of policies which have been forced upon the banks by Federal regulations having to do with "Equal Opportunity".

(Not all. There are a few cases in which someone does something unethical or criminal purely for personal gain. But by and large, those incidents are so rare that they tend to vanish into the background.)

Investment scandals are similar, particularly since all the "investment reform" legislation of the late 70's and early 80's. And there is a very good reason for the increase in such scandals soon after the introduction of such legislation: the Law of Unintended Consequences. You have a bunch of people (Congress) who, by and large, have little experience in the business world (most Congresscritters are either career politicians or failed businesspeople) who are trying to write the rules by which business is allowed to operate. Even if you credit them all with hearts of gold (pause for ironic laughter), well, "good intentions ain't no protection when you're monkeyin' with a buzz-saw."

The problem isn't over-regulation. Nor is it under-regulation. Most of it is ignorant regulation... and too much stubborn pride to admit that mistakes have been made, and need to be corrected.

[sirfox.livejournal.com]

I'm not hot and bothered about it, just tired of being continually disappointed at the collusion of government and industry for their own enrichment at the expense of others.

Sorry, i don't buy your equal opportunity explanation, or that that the fraud we see is only *rarely* for personal or corporate gain. Mortgage backed securities were a great investment. Then all the good investments were bought up, but demand stayed high. For the sake of profit, questionable mortgages were wrapped into bundles with okay ones, and sold as prime. People who had no business getting a mortgage were told "sure! You Qualify!", their paperwork was fudged and faked, and as soon as the family was put into a house they couldn't afford, their mortgage was bundled and sold off to some other sucker. That's noting to do with equal opportunity, that's outright fraud.

This is exactly what Bank of America JUST got charged with doing, knowingly, and systematically. Not Bob the Rogue Mortgage specialist, but the entire company.


I can't agree on you on ignorant legislation, either. It isn't congresscritters who write this legislation anymore, it's corporate lobbyists who do, (often retired and now unaccountable congress members, who are often more successful business folks than you give them credit for) and they meet with congress in closed door sessions to do so. (See Cheny's closed door meetings with industry folks to craft the administration's energy policy) The effects are completely intentional, at least on the part of the lobbyists. Some of Congress might be ignorant, but the bill's authors aren't.

[makovette.livejournal.com]

It's a fair cop. Now what to do about?

Mako

[laurie-robey.livejournal.com]

That's a question I'd like to hear a good answer to! Unfortunately, I don't know what the answer is.

[smrgol-t-kirin.livejournal.com]

The situation described in the article is exactly where I am right now.
My experience and age (33 years experience, age 59) have put me out of the active job market in my profession (architectural drafting), and being out of work since my furlough in 2009, I'm also 4 years behind in the software used (AutoCAD, RevIT).

I currently work in a local Hobby Shop for less than 1/3 of what I used to make. Luckily I'm single, but expenses here are among the highest in the country and I can't leave the area because I'm also taking care of Mom.

[laurie-robey.livejournal.com]

As someone who lives in another very expensive part of the country for reasons of caring for family, and whose household income is about to drop dramatically, I know what you mean.