An Economy For Everyone: March Good Jobs Recap

Patrick DugganQuality Jobs

good jobs workers manufacturing

In order to build wealth and create opportunities in and across America’s underserved communities, and reverse the troubling trends we’re seeing in our economy, we no longer find it defensible to focus on job creation alone. It’s clear that job creation does not itself equate to lasting economic change. And so, we must shift our focus to the creation of higher quality jobs — jobs that are good for workers and their families, good for businesses, and good for communities — enabling us to build an economy that works for everyone.

Each month, we bring you the latest roundup of news from the fight for quality jobs for working people.

Manufacturing and Blue Collar America: Where Are We Today?

What is the real state of working America? In 1900, factories and farms employed 60 percent of the work force. By 1950, a half-century later, those two sectors employed 36 percent. In 2014, they employed less than 10 percent. The idea of blue-collar jobs driving middle-class incomes for the majority of Americans who don’t go to college is withering on the vine. The harsh reality we need to start from is that American workers no longer “make” many things: they are more often paid to serve people: to care for someone else’s children or someone else’s parents; to clean another family’s home. Read more in The New York Times >

In contrast to the public perception that American manufacturing is perpetually in decline, manufacturing these days is “technically” on the upswing. Since the end of the Great Recession, job losses have stabilized and manufacturing employment has risen nearly 10 percent (to about 12 million jobs). But compared to its peak in 1979, that’s still 7.5 million fewer middle-class jobs in the space – and working people have woken up to the fact that policy choices are responsible for that gap, and policies can be changed. Read more on The Weekly Standard >

From the standpoint of wealth creation, the 21st century is off to a roaring start. Between early 2000 and late 2016, the estimated net worth of American households more than doubled, from $44 trillion to $90 trillion. Although wealth inequality is also a critical problem, that’s still a tremendous amount of money. While this has been great for corporations and shareholders, it’s been a disaster for the majority of Americans. Between early 2000 and late 2016, America’s overall work rate for Americans age 20 and older underwent a drastic decline. If American jobs recovered from the 2001 and 2008 Recessions like they had from 20th century Recessions, more than 10 million more people would have full-time jobs today. Read more on Commentary >

We know three of the major root causes for this: trade deals force working-class Americans to “compete” with people making pennies on the dollar overseas; companies driven by wealthy shareholders to invest in automation instead of workers; and thirty years of relentless attacks on unions and organized labor. But there’s another reason that working people have seen job opportunities decline: monopolies. Read more in Harvard Business Review >

Over the last 15 years, for example, labor productivity has grown faster than wages, a sign that workers are not being adequately compensated for their contributions. From manufacturing to retailing, giant companies have managed to gobble up a larger and larger share of the market. While such concentration has resulted in enormous profits for investors and owners of behemoths like Facebook, Google, Walmart, and Amazon, this type of “winner take most” competition is bad for workers as a whole. Mergers create redundancies—businesses don’t need two plants in the same state – so they cut jobs that fall hardest on local communities. Read more in The Nation > and also in  The New York Times >

We Could See Big Job Gains By Thinking Small

95% of American companies are small businesses – and small businesses in their first five years of operation create nearly all the net new jobs. So supporting new and expanding small businesses should be a no-brainer, right? It’s import to know that women, minority and immigrant business owners are the key drivers of entrepreneurial growth today – and they also have the hardest time getting money from banks and investors. For example, women are founding businesses at 2.5 times the national rate and the number of minority women-owned businesses grew by 315% between 2002 and 2012. Therefore, inclusive access to capital should be a top priority for anyone working to create good jobs. Read more from our friends Accion >

States also need to take the lead when it comes to creating good jobs. We’ve already looked at how empowering giant companies over local and small companies erodes jobs. But it’s unconscionable when states and cities use their taxpayers own money to subsidize those corporations who are killing their jobs. Our friends at Good Jobs First have chronicled how Walmart and Amazon alone have managed to capture $3 billion in corporate welfare while driving down wages and killing hundreds of thousands of small businesses and jobs. Read more on Bloomberg >

One great example of local investment comes from our friends in the North Country. In Minnesota, they just announced a new bi-partisan effort to bring the state to 50 Percent Renewable Energy by 2030. That’s great for the environment – but by pushing the issue on renewable energy on the local level, Minnesota will also create more than 15,000 middle-class jobs and a billion dollars of economic activity at the local level, spurring even more job creation. Read more on the state website >

Another example comes from Mississippi. If you went to Water Valley, Mississippi a decade ago, the majority of the storefronts on the small town’s Main Street were empty. Now, because of local-first and small business investments, there’s a brewery, art galleries, restaurants. While the businesses aren’t wildly profitable, the town sustains them. It’s a different sense of what “success” means than in most of the country. Read more in Fast Company >

Wisconsin’s Organic Valley is yet another example – it’s now home to the largest cooperative of small-scale farmers in the United States, with more than $1 billion in annual revenue. They start by setting dairy prices that are enough for farmers to operate without harming the animals, the workers, the customers, or the planet. And instead of paying exorbitant salaries to executives or huge returns to investors, the company helps conventional farmers make the expensive transition to organics. The prosperity of these small farmers ripples out into the surrounding communities, where those who provide farm families with goods and services can also prosper. Read more on Yes! Magazine >

Good Jobs Solutions Put Workers First

Abraham Lincoln once said that “Labor is superior to capital, and deserves much the higher consideration.” Bill Gates, Warren Buffett, and the Koch brothers alone have as much wealth as 128 million working Americans combined. Congress can reverse this runaway inequality and rebuild the middle class by supporting worker ownership of companies. It’s a proven way to increase wages, build wealth, strengthen companies and save communities. When employees buy a healthy business, they keep a viable company in the community and on the tax rolls – and earn higher wages and equity that boost household savings. Read more on Sustainable Business Council >

One golden opportunity for policymakers to step up for America’s workers is, surprisingly, in the area of driverless cars. If Uber, Google, GM, Ford, and the many other big companies working on driverless car and truck technology really succeed, they’re put 5 million middle-class Americans out of work. No one should expect a seamless transition for the many drivers whose jobs get run over by driverless technology. That’s where wage subsidies, earned income tax credits, extended unemployment insurance, and some form of adjustment assistance might come into play. We as a nation have years to plan, and there will be a rich revenue stream to draw from – so there’s no excuse for not creating new middle-class jobs these workers can move into. Read more on American Prospect >

When we talk about good jobs, we’re not just taking about wages. We also mean benefits to help strengthen families. We hear bits about parental leave policy from the White House, and it’s no secret that big tech companies – who employ mostly men – have been tripping over themselves to roll out generous family leave policies. Turns out that trend was limited to a certain sector of the American economy. Over the last decade, many companies have instead reduced their leave offerings. That needs to change. Read more on Bloomberg >

 

Beginning this year, PCV has shifted its mission in order to move our economy to one where quality jobs are the norm—not the exception. CDFIs like ours must build consensus around a common definition of a quality job, undertake practical efforts to foster the creation of quality jobs, and measure results to understand what works.