Complacency About an Inadequate Recovery

We have officially emerged from the economic downturn that began at the end of 2007, but for many workers, it really doesn’t feel that way. Yes, employment has finally returned to prerecession levels, but many of the jobs that have come back are inferior to the jobs that were lost.

A report by the National Employment Law Project (PDF) finds that “lower-wage industries accounted for 22 percent of job losses during the recession but 44 percent of employment growth over the past four years. Today, lower-wage industries employ 1.85 million more workers than at the start of the recession.” The report finds the opposite is true for mid-wage and higher-wage industries, with greater losses and smaller gains.

Yet it’s surprising how often I encounter cavalier attitudes toward the economic plight of working Americans.

Sunday’s Review section of The New York Times featured an op ed piece called “Fear Not the Coming of the Robots,” by the investment advisor Steven Rattner. The article features a nifty graph that you really must view to appreciate. It shows one column with bars representing occupations that used to employ large numbers of workers but have been decimated by automation. These occupations include word processors, telephone operators, computer operators, proofreaders, travel agents, and switchboard operators, among others. For each occupation, the graph shows not only the number of jobs lost but also the median wage, which tends to be in the thirties. Bars in a second column represent occupations that have gained workers, including computer systems managers, physical therapists, financial analysts, registered nurses, financial managers, and accountants. The wages for these occupations are much higher, with the lowest (for accountants) at $63,550.

Rattner concedes that technology has changed the nature of work, making advanced training increasingly necessary, and resulting in a sharp rise in income inequality. But he argues that the main culprit is globalization, not technology, “particularly the ability of companies to substitute far less expensive and increasingly skilled labor in developing countries.”

So what is Rattner’s proposed solution? “To address these very real challenges, we should be embracing technology, not fearing it. That means educating and training Americans to perform the more skilled jobs that cannot yet be performed by workers in developing countries.” I’m all for that, too, but where is the funding for this education and training going to come from? Not from a Congress that is incapable of passing legislation that invests in human capital. And how much more can young people and displaced workers mortgage off their futures for tuition loans?

There’s also the problem of those people who lack the ability to learn advanced skills even if somehow a training program were available. Rattner breezily comments, “Of course, not every worker can be retrained, and so we must help those who aren’t suitable for the new jobs through more robust social welfare programs.” Do you see any indication that Congress is about to beef up support for jobless people? I see the exact opposite. Even the idea of creating jobs through a program such as the Civilian Conservation Corps is a nonstarter in the current political climate.

So, yes, I do fear the one-two punch of robots and global competition. Rattner is like the captain of a ship who tells the passengers, “Don’t worry that the ship is sinking, because you can go merrily sailing in the lifeboats”—but the lifeboats aren’t there.

High Tech Also Spawns Small Businesses

Everyone is familiar with gigantic businesses such as Facebook and Amazon that are using Internet technology to create new business models—and therefore new jobs. Just this week, the transportation-alternative app Uber was valued at $18 billion, provoking a flurry of comments from business columnists, some of them thinking the valuation crazy and others thinking it appropriate.

But it’s important to pay attention to small businesses that are springing up as new technologies create opportunities for entrepreneurs who are able to think creatively.

This idea came home to me last week in New York City, as I was walking down 16^th Street past the corner of Irving Place, opposite Washington Irving High School. I spotted a parked van with the logo, “Pure Loyalty Electronic Device Storage.” The van was about the size of a food truck and looked very much like this one:

I peeked inside and saw what looked like curtains with pouches sewn on, each labeled with a number. The worker at the window told me that students from the school are not allowed to bring cell phones, tablets, MP3 players, or other electronic devices into the school, so they check them with her each morning (as at a hat-check window) and retrieve them when school lets out. They are happy to pay the dollar-a-day fee rather than be without their devices for as long as it takes them to get to school from home in the morning and back again at day’s end.

According to the New York Daily News, the business was operating trucks in three New York boroughs in 2012 and was founded and owned by 40-year-old Vernon Alcoser, a former correctional officer. That same year, the New York Post estimated that the industry was bringing in $4.2 million per year. In addition to the trucks, some neighborhood grocery stores are offering the storage service as a sideline business.

The industry is not entirely carefree, however. In June 2012, a truck owned by Safe Mobile Storage, parked near Christopher Columbus High School in the Bronx, was attacked by armed bandits, who tied up the workers and took their money, plus 22 cell phones from storage.

Despite such setbacks, the industry seems likely to serve its niche role as long as high schools with metal detectors enforce the citywide ban on electronic devices in the classroom—or until schools provide lockers where students can leave them.

Now that electronic devices have become our constant companions, they are creating countless business opportunities for entrepreneurs who offer to create apps for them, accessorize them, repair them—and store them.

Occupations Where Workers Get High (or Don’t)

On a recent episode of This American Life, host Ira Glass identified several occupations as those in which workers have the greatest self-reported percentage of substance abuse, according to the Department of Health and Human Services. I checked for the source of this information and could not find any research later than 1993, when HHS conducted a household survey and later published the results as “Drug Use Among U.S. Workers: Prevalence & Trends by Occupation and Industry.”

It seems likely that the overall incidence of workplace substance abuse has declined since then, perhaps aided by the passage of the Drug-Free Workplace Act of 1988 (even though that law applies only to federal contractors and federal grantees). At least, that is what is indicated by urine tests conducted on workers. Quest Diagnostics reports that between 1988 and 2012, the positivity rate for its urine tests showed a 74 percent drop-off (from 13.6 percent to 3.5 percent) for the U.S. workforce as a whole. Among those workers federally designated as in safety-sensitive occupations, the decline was smaller (only 38 percent), but dropped from an already-low percentage of 2.6 to 1.6.

The Quest Diagnostics report does not break down findings by occupational groups, but it quotes Mary Brown-Ybos, director of compliance for DISA Global Solutions, Inc., and president of Substance Abuse Program Administrators Association (SAPAA), as saying, “Some industries, such as the restaurant industry, have adopted an attitude that drug use in their industry is something they cannot control.”

The report also noted increases in some categories of drugs. Positivity almost tripled for amphetamine and methamphetamine. Prescription opiates also increased in use, with hydrocodone and hydromorphone more than doubling and oxycodone up by 71 percent.

For what they are worth, here are the findings of HHS from the early 1990s.

Ten Highest Rates of Current Illicit Drug Use, 1991–93
Rank	Occupation Category	Percentage Reporting Drug Use
1	Other Construction	17.3
2	Construction Supervisors	17.2
3	Food Preparation	16.3
4	Waiters and Waitresses	15.4
5	Helpers and Laborers	13.1
6	Writers, Designers, Artists, and Athletes	13.1
7	Janitors	13.0
8	Purchasing Agents and Buyers	12.9
9	Auto Mechanics	12.8
10	Construction Laborers; Other Laborers (tied)	12.8

Ten Lowest Rates of Current Illicit Drug Use, 1991–93
Rank	Occupation Category		Percentage Reporting Drug Use
1	Police and Detectives		1
2	Administrative Support		2.2
3	Teachers		2.3
4	Child Care Workers		2.6
5	Dental and Health Aides		2.8
6	Data Clerks		3.2
7	Records Processing Clerks		3.5
8	Computer Programmers and Operators		3.6
9	Engineers		3.9
10	Therapists		4

Ten Highest Rates of Heavy Alcohol Use, 1991–93
Rank	Occupation Category	Percentage Reporting Drug Use
1	Other Construction	20.6
2	Construction Laborers	19.9
3	Helpers and Laborers	19.5
4	Auto Mechanics	16.3
5	Food Preparation	16.3
6	Truck Drivers, Light	15.1
7	Vehicle and Mobile Equipment Mechanics and Repairers	14.9
8	Painters, Plasterers, and Plumbers	14.8
9	Carpenters	13.8
10	Material Moving Operators	13.8
Ten Lowest Rates of Heavy Alcohol Use, 1991–93
Rank	Occupation Category	Percentage Reporting Drug Use
1	Data Clerks	0.8
2	Personnel and Training Specialists	1.1
3	Secretaries and Typists	1.4
4	Bank Tellers	1.5
5	Bookkeepers	1.7
6	Clinical Laboratory and Technologists	2.2
7	Teachers	2.2
8	Dental and Health Aides	2.3
9	Computer Scientists and Analysts	2.4
10	Child Care Workers	2.6