9/15/97

KUFM/KGPR

T.M. Power

Being Forced from "Good" to "Lousy" Jobs

One of the dominant concerns about the Montana economy is that it has been systematically losing "good," high-paying jobs and replacing them with "lousy," low-paying jobs. In the common characterization of this assumed downward slide, the well-paid forest products, miner, or smelter worker is laid off and, faced with no replacement jobs of the same quality, forced to take a minimum wage job "flipping burgers."

A new data source allows us to investigate this common characterization of the economic grinder that Montana’s blue collar workers have been put through. That data source allows us to track individual workers as they move between industries and see what industries they are leaving and what industries they are moving into.

That data, of course, confirms a significant net decline in employment in forest products as well as mining and smelting. More workers left those industries than were hired into them. Those leaving, of course, were not all laid off. There was also considerable voluntary turnover in these jobs as the industries downsized. That data also shows considerable growth in travel-related and retail trade jobs, both notoriously low paid. That is the superficial evidence regularly cited to support the burger flipping future of hour high paid blue collar workers.

However, almost none of those workers who left forest products, mining, and smelting moved into the "eating and drinking" industry (the infamous "burger flipping") or other tourist or travel employment. Instead, the movement was overwhelmingly into construction, other manufacturing, and other relatively high-paid blue collar jobs. That movement between blue collar jobs was almost seven times more likely than a movement into a travel industry job. Movement into the relatively higher-paid service industry jobs, business and medical services, education, and government, was five times more likely for forest products, mining, and smelter workers than movement into burger-flipping-like tourist employment. If one combines the blue collar and higher-paid service industries, it was almost twelve times as likely that the move was into one of these high-wage industries rather than into the travel industry.

Actually, despite being the fastest growing segment of the economy, almost no one moves into the travel industries from a job in another industry. There is significant net movement away from the growing travel industries into other employment. The explanation for this is straight-forward enough: Travel industry jobs are entry level jobs taken by young people and new entrants into the labor force. They provide temporary employment for workers on their way to higher paid jobs. The same is true of retail sales jobs, another relatively low-paid sector of the economy that has been growing. That sector also regularly has more people moving out to other industries than moving in. That doesn’t mean that employment is declining in these industries, it actually has been growing considerably. The workers moving on to other jobs are replaced by new entrants into the workforce rather than by workers shifting from some other jobs in some other industry. When the low wages and the part-time and seasonal nature of these jobs are criticized, their entry-level, stopping-off character should be kept in mind. For students, young people, those seeking part-time work, and new entrants into the workforce, these jobs serve a very useful function.

This is not to say that everything is great in Montana and national labor markets. It is not. The blue collar path to a middle-class lifestyle is being systematically closed off for younger, less educated workers. While their parents may be doing reasonably well in the changing economy, they are not. The result is increasing child poverty and inequality. In addition, being laid off from a job of long tenure imposes steep financial and emotional costs. Although ultimately re-employed in a comparable job, that may take many months and the average earnings on the new job are likely to be lower by ten to twenty-five percent.

We have enough problems in easing the economic transition for our workers, families, and communities. We do not need to exaggerate those problems or caricature them with images of millwrights and miners being forced from $20 an hour jobs to $4 an hour jobs "flipping burgers" for the rest of their lives.