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Tuesday, July 12, 2011

Why America Needs More Bad Jobs

Everyone agrees--America needs more good jobs. But what if good jobs aren't enough? What if we really need more bad jobs?

Read Why American Needs More Bad Jobs
Posted by Suzanne Lucas at 12:23 PM

5 comments:

Long Time Admin said...

The process of starting at the bottom of the ladder, learning and acquiring skills as you go, and progressing in your career used to be called "paying your dues". No one wants to do that any more.

Todays companies do not provide much, if any, training. (One exception that I know of through personal experience is Walmart Home Office.) You have to come into the job with the skills and knowledge needed to perform immediately.

Bad jobs versus good jobs?

I guess ANY job looks good to someone who's hungry.

July 12, 2011 3:29 PM
Mike C. said...

Your analysis is incredibly confusing to me, perhaps you could clarify a few things for me:

1. Regarding being too hard to fire, what are you talking about specifically? You tell someone they're fired and they're fired. This isn't Europe where some nations require severance payments, personal improvement plans or advance notice. What difficulties do we in the United States have that nations that are doing much better than we are (such as Germany or Australia) don't?

2. On regulations and cost.

a. Are you not forgetting the fact that those on minimum wage are spending all of their money anyway, and an increase in wages leads to greater aggregate spending and greater likelihood of savings? Having people who are able to take care of themselves and become contributing members is much cheaper than having them have to rely on social and emergency services. That's why we have unemployment insurance as you know.

b. How can you directly evaluate the profit that employees bring in if they aren't directly selling or producing something? HR comes to mind, as do maintenance staff, research/development (ha!), regulatory compliance (accounting/legal/industry standards), marketing and so on?

I don't mind the idea of simplifying things, the law is in general written for lawyers and not the layperson after all. I also think that folks would better understand what rights they do have and better protect themselves from abuse if things were simplified.

3. Your conclusions that things aren't working now are certainly correct, but I have a difficult time believing your examples of companies on the edge when the profit margins and cash reserves of many companies have never been higher. I understand it's a simple example to illustrate your point and I don't want to engage in a semantic argument, but it seems to me that business owners have simply fired a bunch of folks and scared the rest into working more for fewer wages while owners pocket the increased profits.

One example of a company with lots of the jobs you're talking about is Alcoa, which posted some rather impressive news in the past few days. I doubt they'll be hiring much however.

Anyway, just a few thoughts. I would be curious as to what kind of specific things you'd like to change. There was also a recent edition of This American Life you might want to check out on the issue of "creating jobs".

July 12, 2011 11:28 PM
Film Co. Lawyer said...

Thank you, Long Time Admin. If you're only going to get laid off sooner or later regardless of any effort you put in, what incentive do you have to do a good job? Furthermore, these companies want to make you work for rock bottom prices while providing zero training. Someone is sadly mistaken, for instance, if they think I'm going to use my years of legal knowledge & training (incurring on average six figure student loan debt that can't be discharged in bankruptcy) for $30K a year; yet that is what some law firms offer to attorneys w/1-3 years experience & not just in rural areas.

Mike C also makes some great points. The only time you have true difficulty in firing anyone is if they're in a union. Most jobs don't fit that. Plus, statistically speaking, most people don't have the money to hire attorneys (I'm one myself) and more often than not unrepresented plaintiffs lose cases.

What about the mismatch between what a minimum wage job offers & things like health care costs? Plus, what about the employers who force students to pick between their education, the very thing that would lead to one's increased self-sufficiency, and that dead end minimum wage job? That's not providing the solution you claim these jobs provide. It doesn't sound like you've ever been in one or know anyone who HAD to take one of these jobs to feed their families & have some type of quality of life. I actually do & in reality, the wages/hours aren't enough to pull anyone up by their bootstraps. Otherwise, we'd see far more people moving ahead in life.

I think Mike C nails it on the head w/employer greed, which contributes to lack of employee incentive/motivation (I'm witnessing firsthand how this harms an employer). Not to mention the mismatch b/t wages/hours & the actual costs of survival in an area.

July 13, 2011 4:20 AM
Suzanne Lucas said...

Mike,

1. Have you ever tried to fire someone? Even though most employees are at will, you still have to be prepared for the lawsuits. It doesn't matter if your reason is totally legitimate, if you fire people you're vulnerable to lawsuits and investigations by the EEOC. You have to be able to actively defend yourself against charges of discrimination based on race, national origin, pregnancy status, or disability status. People tend to think that their firing was illegal, even when it's not. A large company with a seasoned HR department can steer you through the process and has the proper documentation to handle inquiries from government bodies. The little shop on the corner doesn't.

2. When you have regulations, it increases costs. Somebody has to make sure you are following those regulations. You'll note that I just posted an article about a California law that requires specific paydays. Knowing about and complying with silly things like this cost businesses, especially small ones, a great deal of money. If you want to see an example of excessive gov't interference in business, check out this post: http://www.popehat.com/2011/07/12/the-colorado-department-of-human-services-knows-in-terrifying-detail-what-is-best-for-your-children/

a. No, I'm not forgetting that. In fact, I'm arguing that it's better to have people in the workforce than it is to spend tax payer dollars on them.

b. There are lots of ways, but none of them relevant to this article. I'm not talking about hiring new HR managers, who cost the company money but save it money by reducing risk of being sued, for instance. I'm talking about super-low-level jobs for the inexperienced and uneducated. These are precisely the types of jobs where it is easy to quantify their contribution.

3. Cash reserves of some big companies have never been higher. This is not an argument that big companies start hiring people. This is an argument that there is benefit to allowing small businesses in inner cities to flourish and that even though those jobs are "bad" ones, they will provide a foundation for the employees to learn skills so that they can one day move up to "good" jobs.

July 13, 2011 9:28 AM
Mike C. said...

Sure I've never fired someone, but I have first hand accounts of it being done time and time again. There's no performance reviews or regulatory paperwork involved. People are called down to the boss's office at 5pm on Friday, given a two week severance and told not to let the door hit them on the way out. There's no record of infractions or missed goals, they are just told to leave and then have their unemployment claims challenged. Mostly they avoid the problem by hiring H1-B visa holders who are constantly afraid of being fired and deported. Sure, the facts are more complicated than that, but not everyone understands the intricacies of immigration and labor law. I'm certainly no expert.

So while you talk about things like legal protections and proper procedures, I just don't see it in my day to day experience. Maybe I'm just in a "special place", maybe you only have experience at larger firms, who knows. There's also the matter that you're a trained and experience expert who understands where people have rights or have the ability to fight - these are not commonly taught or known. So while you might be worried about a possible EEOC complaint or ADA violation, most folks simply don't know or can't afford to defend their rights, right or wrong.

And even if it is difficult, why not go to a temp agency instead? Have a contract that makes it trivially easy to get rid of someone. Un/underemployment is still high and many would be more than willing to accept terrible terms in exchange for the ability to feel like a person again and pay their bills.

Secondly and most importantly, similar and more restrictive laws are in place all over the world. I mentioned two nations in particular with much stronger employment laws - Germany and Australia. I'll add Finnland to the list as well. They are doing much, much better than we are in terms of employment and GDP growth, and they some how are able to do it in spite of much tighter hiring/firing regulations and much greater enforcement of those regulations than in the United States. Because of this, I argue that while taken alone regulations may nominally increase costs, there is way more in play than issues of regulations.

If we want to look at the extreme situations, why not look to nations with no labor regulations at all, say Somalia. Sure it's a hyperbolic example and there are plenty of European nations where regulations are getting in the way, but then it tells me that there is a weak correlation and business owners are simply trying to get a little more out of their workers.

July 14, 2011 8:12 AM

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