Facts About Low Wage Work
For generations, Americans
shared a tacit understanding that if you worked hard, a livable income
and basic securities would be yours. That promise has been broken.
Today, more than 30 million men and women in this country work in jobs
that pay poverty wages and provide few if any benefits.
A large body of research
amassed over the past decade clearly demonstrates that the structural
changes to the U.S. economy over the past 20 years resulting from
globalization, industry deregulation and the computerization of the
workforce have led to harsh working conditions, reduced benefits, and
fewer opportunities for advancement for workers in low-wage jobs.
Workers in low-wage jobs
are the least likely to be provided health care coverage for themselves
and their families; they cannot afford the premiums on their own, so
most do without. Sick pay, family leave and retirement benefits are
virtually nonexistent. Their jobs leave these workers little flexibility
to care for their children; quality childcare during “regular” business
hours is unaffordable for most, and finding childcare during their many
nighttime shifts is an even greater challenge. Low-wage workplaces are
often physically damaging and emotionally degrading. High injury rates
and unsafe conditions plague these locations, compounding the risks for
workers without health insurance. With few opportunities for training or
advancement, most are locked into these low-wage jobs.
That these conditions
continue erodes Americans’ most cherished values of fairness, personal
responsibility, hard work and perseverance, and sends the message that
work does not pay. Failure to address this issue not only hurts these
workers’ families, it erodes the functioning of America’s communities,
its economy and our very notions of what democracy can achieve.
Who Are Workers in Low-Wage Jobs?
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Most workers in low wage jobs are adults.
Teenagers comprise only seven percent of the low-wage workforce.
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Nearly two-thirds of the low-wage workforce is
white. Yet African Americans and Latinos are over-represented in
this group relative to their participation in the overall workforce.
In fact, the proportion of minority workers in 2001 earning a low
wage is substantial: 31.2 percent of African Americans and 40.4
percent of Latinos in contrast to 20 percent of white workers.
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Women make up 60 percent of the lower-paying
workforce, even after a slight decline over the past two decades.
Almost 30 percent of the female workforce is low-wage, in contrast
to less than 20 percent of the male workforce. Of these women,
three-fourths are white. Yet the proportion of minority women is
significantly higher than white women: 35.8 percent and 46.6 of
African American and Latino women in contrast to 26.2 percent of
white women.
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Men have increased their share of the low-wage
workforce reaching close to one-fifth of male workers.
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When it comes to education, it is not
surprising that the low-wage workforce has less formal education
than workers in more highly paid occupations. But contrary to the
common belief that most low-wage workers lack a high school
education, 40 percent have a high school diploma, 38 percent have at
least some postsecondary education, and five percent have a college
degree. The low-wage labor force overall is better educated today
than it was a generation ago. This mirrors the increase in education
in the general labor force.
Myths and Facts
MYTH: Low-Wage jobs are the
ones you see in your neighborhood McDonald’s.
FACT: Fast food jobs
constitute less than 5% of all low-end jobs. Low-wage, low-reward jobs
are all around us and include: security guards, nurse’s aides and home
health-care aides, child-care workers and educational assistants, maids
and porters, call-center workers,
bank tellers, data-entry keyers,
cooks, food preparation workers, waiters and waitresses, cashiers and
pharmacy assistants, hair dressers and manicurists, parking-lot
attendants, hotel receptionists and clerks, ambulance drivers, poultry,
fish and meat processors, sewing-machine operators, laundry and
dry-cleaning operators, and agricultural workers.
MYTH: Low-wage jobs are
unskilled.
FACT: As important as these
jobs are, most of us do not even notice them. When we do so, it is
almost always in a negative light. In the public view, low-wage jobs
tend to be lumped together and referred to as “hamburger flipper,”
insinuating both a lack of real skill and social value. Policy analysts
and public officials refer to “low--wage, low-skilled” jobs as if the
two terms were inseparable. This mistakenly assumes that if a job pays
poorly, it must be because it does not call for many skills. In fact,
these jobs require knowledge, patience, care and communication. Most of
them require constant interaction with people, whether they are a
patient in a health-care setting, a child in a day-care center, a guest
in a hotel, a tenant in a commercial office building, or a customer in a
department store.
MYTH: Most low-wage workers
are teenagers, illegal immigrants or high school dropouts.
FACT: America’s low-wage
workers are mostly (nearly two-thirds) white, female, high school
educated and have family responsibilities. Teenagers comprise only 7% of
the low-wage workforce. Minorities and women are disproportionately
found in low-wage jobs and occupy the lower rungs of the ladder within
this workforce.
MYTH: Enduring the
harshness of low-wage jobs is only temporary; since they are merely a
stepping-stone to better paying jobs.
FACT: Mobility will not
bring significant advancement to most low-wage workers. Even after a 25
year period, half of those in the lowest 20 percent of wage earners had
not moved above that group and of those that moved half had only moved
to the next highest wage group, still below the median wage. Low-wage
jobs, historically have had few career ladders. Today, they offer even
fewer.
MYTH: Reskilling will solve
the problem
FACT: Of course, better
education and fluency in new technologies are essential to improve job
options of this and the next generation of workers. Yet, these labor
intensive industries will continue to demand large numbers of workers
regardless of individual mobility and these are the growing sectors of
our economy. In the next ten years, the low end of the job market will
account for more than 30% of the American workforce. Employers will hire
nearly twice as many food-service workers as software engineers, hire as
many cashiers as they do computer-support specialists and hire more than
twice the number of customer-service representatives as they do computer
systems analysts. The reskilling approach will do little to improve the
lives of most workers in these low-wage jobs, jobs that will continue to
grow as a proportion of our economy. What these workers need is to be
adequately rewarded for the skills they already possess.
MYTH: Globalization stops
us from doing anything about the problem.
FACT: As profound as the
impact of global trade has been on our economy, it does not preclude
improving the wages and working conditions for lower-wage workers. Only
a small portion of low-wage jobs are actually in industries such as
manufacturing that compete globally. Most lower-wage jobs are and will
continue to be in the non-tradable service and retail sectors. Checking
out groceries, waiting on tables, servicing office equipment, caring for
children, tending the sick and cleaning up for the rest of us must take
place in a specific location where the child, patient or customer is
present.
Other industrialized
countries competing in the same global markets as the United States have
made political and business choices to ensure that all workers can rely
on a safety net. As a result, workers in similar jobs in other
industrialized countries have fared far better than American workers.
Low-income Americans have living standards that are 13% below that of
low-income Germans, 17% below low-income Belgians and 24% below the
average income of the bottom 20% of Swedes. This is despite the fact
that the median American enjoys a standard of living far above the
median German, Belgian or Swede.
MYTH: Low-wage jobs are
merely the result of an efficient market and we as a society have little
control over this problem.
FACT: Low-wage workers face
a world in which they have little power to change their conditions—a
result of our creation, not natural law. Over the past quarter century,
a variety of political, economic and corporate decisions undercut the
bargaining power of the average worker, but especially those in the
lower strata of the workforce. Those decisions included the push to
increase global trade and open global markets, the increase of immigrant
workers into the United States, government efforts to deregulate
industries that had been highly unionized, Federal Reserve policies that
concentrated on reducing the threats of inflation, and a corporate
ideological shift that eliminated the postwar social contract with
workers and emphasized a principle of maximizing shareholder value.
These decisions contributed to the deterioration in low-wage conditions
and a worsening of disparities in income and wealth.