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where are the jobs

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In a post entitled “It’s harder to pay workers well in America“, Ezra Klein claims that the reason there used to be more high-paying middle class jobs is that companies had the ability to pay more in the past, that “a lot of them just made that choice because, well, they could”:

Foreign competition has made the wage gap between different sorts of workers vast: Paying American workers a good wage while the other guy pays Thai workers a bad wage leaves you at much more of a competitive disadvantage than paying American workers a good wage while the other guy pays American workers a mediocre wage. Unions are partially in decline because of policy, but they’re partially in decline because these forces make it very hard for them to survive. Bottom line? It’s hard to pay workers well in America now, even if you want to.

It’s easier to pay them well, of course, if you have to. Without getting too deep into the methodology of the book, it’s fairly persuasive on the idea that the good jobs aren’t going away so much as they’re sorting themselves by education and ability. At the same time, the pace of educational attainment in America has slowed considerably. So the percentage of good jobs that require credentialed workers has increased, but the percentage of credentialed workers hasn’t. That’s probably a big part of this story, and it speaks to the need for much, much more investment in the workforce.

This is all kinds of wrong.

First of all, the share of profits going to workers has been decreasing – “Companies are paying less of their cash gains in the form of wages and salaries than at any time since the Great Depression” according to a post at Angry Bear.

Companies have more ability to compensate their employees now than in the past. They just aren’t doing it – not for the average employee at least.

His solution of more education is laughable. An astonishingly large percentage of college attendees learn almost nothing in college.

Getting more people to go to college will result in the people who currently do not have either the ability or the desire to go to college spending years of their lives earning nothing and learning almost nothing. It won’t result in more highly paid middle class jobs.

Written by geek

22/01/2011 at 2:20 am

Posted in economy

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