Despite increased educational attainment, an older workforce and higher productivity, job quality has declined in the United States over the last 30 years.
And despite substantial increases in the educational attainment and age of the US workforce over the last three decades, which are reflected in productivity, the quality of jobs in the United States as measured by wages and access to benefits has deteriorated sharply.
The report, “Making Jobs Good,” considers the impact of five policies on job quality, in essence, “good jobs” and “bad jobs.” A good job is defined as one that (1) pays at least $19 per hour (in constant 2011 dollars) and (2) has employer-provided health insurance and (3) has some kind of retirement plan (either a traditional pension or a 401(k)-style plan). A bad job is defined as one that meets none of these three criteria, The policies considered in the report are universal health insurance, a universal retirement system (over and above Social Security), a large increase in college attainment, a large increase in unionization, and gender pay equity.
These policy simulations yield intriguing results. For instance, the pay equity simulation shows that if women and men of the same level of education receive the same pay, the gender gap in the share of good jobs is all but erased. The policy simulations also demonstrate that increasing unionization appears to be substantially more effective than a comparable expansion of college attainment in increasing job quality in the economy. For all workers, and separately for men and women, increases in unionization consistently raise the share of good jobs more than similar-sized increases in college education. Given that increasing college attainment is a long and expensive process, and one that is likely to be much less effective for older workers, these findings suggest the importance of emphasizing unionization as much or more than college attainment as a key path to improving job quality.
The report also shows that enacting combinations of these policies has a more significant impact than each individual policy. For example, a combination of universal health care and a universal retirement plan increase the share of good jobs by 20.8 percentage points. A universal retirement plan on its own would raise the share of good jobs by 9.6 percentage points, while universal healthcare would increase the share of good jobs by 4.7 percentage points.
The authors note that restoring the link between economic growth and job quality will be a heavy lift. Over the last three decades, increased educational attainment and work experience alone have not been sufficient to prevent a decline in the share of workers in good jobs or an increase in the share of workers bad jobs. However, the simulations described here demonstrate that there are policies that—alone or in conjunction with other policies—can slow and perhaps turn around the fall-off of job quality in the US economy.
—Center for Economic and Policy Research