I was kind of surprised to see this piece in The New York Times "Why American Workers Without Much Education Are Being Hammered." Is that news? Haven't we been told for decades the ticket to higher paying jobs is more eduction? Well, some new research shows just how bad the last couple of decades have been for American workers without much education, and offers some insights as to why.
One of the most startling statistics to come out of the 23-year study that includes three recessions and three recoveries, is that the median earnings of working men aged 30 to 45 without a high school diploma fell 20 percent from 1990 to 2013 when adjusted for inflation.
Men fared worse than women
The NYT article says "less-educated Americans, especially men, are shifting away from manufacturing and other jobs that once offered higher pay, and a higher share are now working in lower-paying food service, cleaning and groundskeeping jobs."
At the same time, "pay levels are declining in almost all of the fields that employ less-educated workers, so even those who have held onto jobs as manufacturers, operators and laborers are making less than they would have a generation ago."
Men without a high school diploma saw earnings go from $31,900 in 1990 to $25,500 in 2013
Men with a high school diploma did only a little better, with a 13% decline in median earnings over the same span.
Women did slightly better than men in the past two decades. Those without a high school diploma saw a 12% decline in median earnings, and those with a high school diploma or some college a 3% gain.
Why the decline?
The Hamilton Project study does find some data to support the commonly-held theories that there has been a decline in the number of jobs in manufacturing and other industries that once paid less-skilled workers good wages, as a result of technology and globalization.
And there have also been changes around worker pay such as less union power, a lower minimum wage when adjusted for inflation, and a culture in corporate America of cutting labor costs to the bone even when profits are soaring.
“One thing that’s always bothered me about the political debate is people want to say either it’s globalization and technology, or it’s institutions,” said Melissa S. Kearney, director of the Hamilton Project and a professor at the University of Maryland. “But of course it’s both.”
Barry Youngerman is a self-employed writer in New York City. He wrote in the comments section of the NYT article that the reporter was remiss in not even mentioning the word immigration.
"The period of declining pay and job opportunities has coincided with a vast immigration of literally tens of millions of people, a huge portion of whom are precisely in this category: less educated, less skilled men."
Another commenter from Europe says the NYT "analysis" earns the "800-pound gorilla award" for ignoring the catastrophic effect illegal immigration has had on lower-skilled American workers. "Perhaps Mr. Irwin (Neil Irwin, the writer of the article) would care to expand on why he thinks the law of (labor) supply and demand does not apply to this particular issue."
GMB of Atlanta writes that higher education hasn't been the way to wage growth either.
"Americans with advanced degrees, over a period that included the dotcom boom, averaged real earnings growth of 0.5% per year. Those with bachelor's degrees enjoyed just under 0.3% per year. Does anyone think that those numbers justify the ongoing college hype emanating from the media on up to President Obama himself?"
He says almost no one is getting ahead.
"Why? This essay mentions automation, which somehow before always resulted in wages increasing alongside productivity. It also mentions globalization, even though most Americans work in sectors that do not complete outside of their state, much less globally. Jacob Hacker, among others, has systematically eliminated those factors as the primary cause of the Great Wage Slowdown, though they do contribute. It's class warfare, friends; the boardrooms are winning and we are losing."