Job polarization

Today’s labour market figures show that we’re seeing job polarization – a relative decline of middling jobs.

My chart shows the point. It shows changes in employment by occupation since 2010, when employment troughed*. You can see there’s been a fall in the number of administrative and secretarial jobs, and stagnation in the number of skilled tradespeople, but increase in the number of professional and “associate professional” jobs, and in the number of care workers. These trends would look stronger if we looked at changes in the last ten years; in this time, the number of skilled tradespeople has fallen.

Looking at wages, there’s a more complicated picture. The clearest story here since the trough of the recession has been the relative rise in managerial pay. This isn’t simply because this is more cyclical than other pay: their wages matched average pay during the 2007-10 downturn. What is perhaps cyclical, though, is the wages of skilled trades. These have outstripped average pay, but this doesn’t recoup their fall in relative wages during the recession.

Despite rising demand and rises in the minimum wage the pay of care workers has declined relative to the average, perhaps because of an abundant supply.

We’ve also seen a relative decline in secretarial pay, which is consistent with declining demand for the occupation.

However, professional and associate professional pay has declined in relative terms. This is consistent with such jobs being less good than they used to be. Or maybe there’s an element of job rebadging here: previously humble occupations have been renamed, dragging average pay down. Or perhaps what we’ve seen is demand for such occupations respond to a decline in relative price.  

A big question here is: what does this mean for social change generally? I’d suggest (tentatively) two things.

One is that all this is ambiguous for equality.

One the one hand, there’s an equalizing tendency here. A couple comprising a skilled tradesman and a secretary would have an above-average household income. But the gap between them and the worst-off has fallen, because of their declining relative pay.

But on the other hand, these changes are increasing inequality not just by raising managerial pay but also by encouraging assortative mating. Once upon a time, well-paid men married their modestly paid secretaries, and this tended to equalize household incomes. Today, there are fewer secretaries to marry. The equivalently placed man is therefore more likely to marry a wellish-paid female. And this exacerbates household inequality.

Perhaps, though, there’s something else. These changes might justify the expansion of universities. Job opportunities for diligent but non-academic people – secretarial and craft work – have declined. Such folk need therefore to go to university to have a chance of a good job. Having a degree doesn’t guarantee getting such a job. But it increases your odds.

There is, though, a more general point here. You don’t have to believe in economic determinism to think that the labour market shapes our culture, with perhaps longish lags. It’s plausible, therefore, that these occupational changes will lead to cultural change perhaps of sorts which we cannot yet predict. It’s not at all clear to me that these changes will be wholly welcome.  

* The numbers aren’t seasonally adjusted, so I’m comparing 2017Q2 with 2010Q2.

Comments

[Jim]

" Job opportunities for diligent but non-academic people – secretarial and craft work – have declined. Such folk need therefore to go to university to have a chance of a good job. Having a degree doesn’t guarantee getting such a job. But it increases your odds."

Yeah right. Thats why the lad I know has a masters in History but works in Argos. Yet if he could drive an HGV or operate an excavator he'd be earning good money.

Fact is the there's too many people with degrees chasing the same supposedly middle class jobs, and many are losing out. The last thing the poor need is a university education and lots of debt, they need to get some real practical skills, thats where money is to be made. Of course it does require real work, not being in a nice warm office chatting to people round the photocopier and thinking you're working.............

[Peter K.]

The center-left/ centrist liberals / neoliberals are currently denying any economic determinism except perhaps a little.

https://www.vox.com/policy-and-politics/2017/8/16/16153616/trumps-idea-that-jobs-will-solve-racism-is-just-wrong

I thought it was commonly accepted among historians that the Great Depression and punitive Treaty of Versailles had something to do with the rise of the Nazis?

Meanwhile the liberal defenders of Obama and Clinton argue strenuously that the financial crisis and Great Recession had nothing to do with the rise of Trump voters or with Brexit.

In my view it's galling.

[DC]

Question: aren't caring services, which I'd imagine includes nurses and physician's assistants, middling jobs? It seems like there would be a spectrum for that occupation, with some of them high-skilled/high wage jobs.

Thus, I don't see a clear polarization story here, and doubt you can trace wages to demand for certain occupations.

[Ralph Musgrave]

Jim, You're spot on. The studies I've looked at which relate types of degree to subsequent earnings have found that arts degrees for males bring no increase in earnings. All other degrees do (i.e. science and vocational degrees for males and ALL TYPES OF DEGREE for females).

Incidentally when looking at those sort of studies, see if they control for family background. Half of them don't. I.e. the fact that people with degrees earn more does not prove a causal relationship because kids from stable middle class backgrounds tend to go to university and that type of kid also tends to earn more even if they don't to university.

[rogerh]

Seems to me the decline in 'humble' jobs has been in place a long time. Because that sort of job is declining so has mass education, there is no point in spending much on educating for McJobs or Uber, so we don't. Worse, consider the position of someone who trains to be a doctor. Once a guarantee of a decent middle class life, now a horrible struggle against box tickers and house prices and Hunt. These two kinds of job are being squeezed on one side by globalisation and automation and on the other side by a gradgrindian penny pinching managerialism.

So where are the good jobs, what path should guide the young and ambitious. Look around and there are good jobs at the top of business but even more good and easier jobs in a layer just underneath government. The jobs that do government's dirty work for them. Not looking after prisoners (say) but screwing down hard on those hired to look after prisoners to choose one example.

Running some sort of government quango or agency seems the racket of choice. Once the province of sensible but boring civil servants (a difficulty for every occasion). Now the quango and agency rackets have been taken over by those with some skills in finance (the extraction and selling off of value), administration (the concealment of one's real purpose and the deflection of questions) and skill in marketing and presenting on the one side a gleaming image of modernity and service whilst ruthlessly managing the reality of delivering very little downwards whilst creaming off a handsome profit.
All a young person needs to succeed is a university course offering Machiavellian Studies and Asset Stripping.

[Miguel Madeira]

"Once upon a time, well-paid men married their modestly paid secretaries, and this tended to equalize household incomes."

They did? Or most had simply affairs with them?

A reason because I doubt much of the theory "in the old days, many man married wit women lower in social class" - if this was true, than one of other two things should also be common:

a) many man marrying with women higher in social class;

or

b) many people living single, because there was many un-matchable pairs of lower class man / upper class women

Afaik, none of the things were common - women marrying down was (and perhaps still is) extremely rare; and in the past living single and unmarried was, I think, less common than today.

[Jim]

" I doubt much of the theory "in the old days, many man married wit women lower in social class""

It wasn't so much as social class per se, more than women in general were seen as being of lesser importance than men. Men were far more likely to be in the senior roles, women in the dogsbody roles. So marrying up is a lot easier when a man from the same social background as his bride has made it to a senior position while the she is still a junior nonentity.

Nowadays the roles could easily be reversed, the female in senior management, and the man in a junior role. But her marrying him is far less likely than when the man was the more 'important' of the two.

Which is why you see more and more single people today - when men and women are considered equal, women marrying up means lots of people left single, when men were considered 'above' women just because they were men, marrying up (or on a par) could be done by virtually every female.

[Blissex]

«All a young person needs to succeed is a university course offering Machiavellian Studies and Asset Stripping.»

Don't Eton and Greats/PPE pretty much teach those already to many a “young person” "of quality"? :-)

[Blissex]

«Men were far more likely to be in the senior roles, women in the dogsbody roles. So marrying up is a lot easier when a man from the same social background as his bride has made it to a senior position while the she is still a junior nonentity.»

Perhaps the matrons of old who managed cleverly the sale and purchase of their sons in the "good catches" market had a different point of view. Perhaps rereading "Pride and prejudice" might supply some of that point of view. :-)

Sometimes I think that it is typically male-chauvinist to think that only being a king or a knight were "the senior roles", and being queen or lady were "dogsbody roles". The women involved, and their mothers, might have been amused by that idea. There have usually been two separate power and status hierarchies, male and female, and to think that the female one was usually less important and powerful is at best naive, and perhaps sexist, and often both.