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Bad Jobs on the Rise

Author

Listed:
  • John Schmitt
  • Janelle Jones

Abstract

The decline in the economy’s ability to create good jobs is related to deterioration in the bargaining power of workers, especially those at the middle and the bottom of the pay scale. The restructuring of the U.S. labor market – including the decline in the inflation-adjusted value of the minimum wage, the fall in unionization, privatization, deregulation, pro-corporate trade agreements, a dysfunctional immigration system, and macroeconomic policy that has with few exceptions kept unemployment well above the full employment level – has substantially reduced the bargaining power of U.S. workers, effectively pulling the bottom out of the labor market and increasing the share of bad jobs in the economy. In this paper, we define a bad job as one that pays less than $37,000 per year (in inflation-adjusted 2010 dollars); lacks employer-provided health insurance; and has no employer-sponsored retirement plan. By our calculations, about 24 percent of U.S. workers were in a bad job in 2010 (the most recently available data). The share of bad jobs in the economy is substantially higher than it was in 1979, when 18 percent of workers were in a bad job by the same definition. The problems we identify here are long-term and largely unrelated to the Great Recession. Most of the increase in bad jobs – to 22 percent in 2007 – occurred before the recession and subsequent weak recovery.

Suggested Citation

  • John Schmitt & Janelle Jones, 2012. "Bad Jobs on the Rise," CEPR Reports and Issue Briefs 2012-23, Center for Economic and Policy Research (CEPR).
  • Handle: RePEc:epo:papers:2012-23
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    File URL: http://www.cepr.net/documents/publications/bad-jobs-2012-09.pdf
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    References listed on IDEAS

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    1. Baker,Dean, 2007. "The United States since 1980," Cambridge Books, Cambridge University Press, number 9780521677554, March.
    2. Baker,Dean, 2007. "The United States since 1980," Cambridge Books, Cambridge University Press, number 9780521860178, March.
    3. John Schmitt, 2005. "How Good is the Economy at Creating Good Jobs?," CEPR Reports and Issue Briefs 2005-33, Center for Economic and Policy Research (CEPR).
    4. Hye Jin Rho & John Schmitt, 2010. "Health-Insurance Coverage Rates for US Workers, 1979-2008," CEPR Reports and Issue Briefs 2010-06, Center for Economic and Policy Research (CEPR).
    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Anna Batyra & David de la Croix & Olivier Pierrard & Henri Sneessens, 2016. "Structural changes in the labor market and the rise of early retirement in Europe," CREA Discussion Paper Series 16-13, Center for Research in Economic Analysis, University of Luxembourg.

    More about this item

    Keywords

    good jobs; bad jobs; retirement; pensions; health insurance; wages; labor; education;

    JEL classification:

    • J - Labor and Demographic Economics
    • J3 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs
    • J31 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Wage Level and Structure; Wage Differentials
    • J32 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Nonwage Labor Costs and Benefits; Retirement Plans; Private Pensions
    • J38 - Labor and Demographic Economics - - Wages, Compensation, and Labor Costs - - - Public Policy
    • J5 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining
    • J1 - Labor and Demographic Economics - - Demographic Economics
    • J11 - Labor and Demographic Economics - - Demographic Economics - - - Demographic Trends, Macroeconomic Effects, and Forecasts
    • J15 - Labor and Demographic Economics - - Demographic Economics - - - Economics of Minorities, Races, Indigenous Peoples, and Immigrants; Non-labor Discrimination
    • I - Health, Education, and Welfare
    • I2 - Health, Education, and Welfare - - Education
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I25 - Health, Education, and Welfare - - Education - - - Education and Economic Development

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