erik lundegaard

Why the Want Ads Suck

“The reason [the minimum wage] has become a big political issue is not that the jobs have changed; it’s that the people doing the jobs have. Historically, low-wage work tended to be done either by the young or by women looking for part-time jobs to supplement family income. ... Now, though, plenty of family breadwinners are stuck in these jobs. That’s because, over the past three decades, the U.S. economy has done a poor job of creating good middle-class jobs; five of the six fastest-growing job categories today pay less than the median wage. ...

”The situation is the result of a tectonic shift in the American economy. In 1960, the country’s biggest employer, General Motors, was also its most profitable company and one of its best-paying. It had high profit margins and real pricing power, even as it was paying its workers union wages. And it was not alone: firms like Ford, Standard Oil, and Bethlehem Steel employed huge numbers of well-paid workers while earning big profits. Today, the country’s biggest employers are retailers and fast-food chains, almost all of which have built their businesses on low pay—they’ve striven to keep wages down and unions out—and low prices.

“This complicates things, in part because of the nature of these businesses. They make plenty of money, but most have slim profit margins ... The combined profits of all the major retailers, restaurant chains, and supermarkets in the Fortune 500 are smaller than the profits of Apple alone. Yet Apple employs just seventy-six thousand people, while the retailers, supermarkets, and restaurant chains employ 5.6 million.”

-- James Surowiecki, “The Financial Page: The Pay is Too Damn Low,” on the New Yorker site. Read the whole thing.

Tags: , ,

Posted at 05:32 AM on Tue. Aug 13, 2013 in category Business  

COMMENTS

No comments yet

You may bypass the ID fields and security question below if you log in before commenting.


 
 






« And for Secretary of State, John Foster Dulles   |   Home   |   Attention Green Bay! »
 RSS    Facebook

Twitter: @ErikLundegaard

ARCHIVES
LINKS
dative-querulous