Where Occupational Birds of a Feather Flock Together

Last week, I blogged about metropolitan areas where the health-care industry dominates. I looked at the trends in the average earnings of health-care professionals in those metros and, for comparison, the trends for health-care professionals nationwide. I found that the Great Recession had no effect on nationwide earnings—they continued to increase at a steady pace—but in the metros where health-care professionals are concentrated, these workers’ earnings took a noticeable dip during the recession years.

I thought it would be interesting to look at some other occupational categories and see how their experiences compared. So I turned to the same database, the Occupational Employment Survey, and identified the metros where occupations in education exceeded 10 percent of the wage-and-salary workforce; where computer and mathematical occupations exceeded 5 percent; and where engineering occupations exceeded 4 percent.

Here are the metros where these occupations dominate:

Metro Area	Education Occupations
Ithaca, NY	15.5%
Gainesville, FL	13.3%
Hinesville-Fort Stewart, GA	13.2%
Champaign-Urbana, IL	12.9%
Corvallis, OR	12.8%
Blacksburg-Christiansburg-Radford, VA	12.3%
Merced, CA	11.7%
Lafayette, IN	11.5%
College Station-Bryan, TX	10.8%
Auburn-Opelika, AL	10.7%
Ann Arbor, MI	10.6%
Athens-Clarke County, GA	10.5%
Yuba City, CA	10.4%
McAllen-Edinburg-Mission, TX	10.4%

Metro Area	Computer & Mathematical Occupations
San Jose-Sunnyvale-Santa Clara, CA	11.6%
Washington-Arlington-Alexandria, DC-VA-MD-WV	7.4%
Boulder, CO	6.7%
Seattle-Tacoma-Bellevue, WA	6.6%
Huntsville, AL	6.5%
Durham-Chapel Hill, NC	6.2%
Austin-Round Rock-San Marcos, TX	5.7%
Trenton-Ewing, NJ	5.5%
San Francisco-Oakland-Fremont, CA	5.5%
Madison, WI	5.5%
Raleigh-Cary, NC	5.2%
Colorado Springs, CO	5.1%

Metro Area	Engineering Occupations
Huntsville, AL	8.3%
Columbus, IN	8.1%
San Jose-Sunnyvale-Santa Clara, CA	5.7%
Warner Robins, GA	5.2%
Norwich-New London, CT-RI	5.0%
Bremerton-Silverdale, WA	5.0%
Kennewick-Pasco-Richland, WA	4.8%
Palm Bay-Melbourne-Titusville, FL	4.5%
Detroit-Warren-Livonia, MI	4.4%
Holland-Grand Haven, MI	4.3%

Next, I graphed the 2007–2014 earnings of professionals in the metros where they are concentrated and also nationwide. Here’s what I found:

 

 




The most obvious common element is that the workers in all of the occupationally-concentrated metros experienced earnings downturns during the recession years, whereas across the nation the same kinds of workers experienced no such downturns. Therefore, it appears that what I found for health-care workers last week is not unique to them. Perhaps any concentration of a particular type of worker (and therefore of an industry) increases the wage instability of a metro area.

But I found one interesting way in which the experiences of these occupations differed: For health-care and education professionals, average wages were higher nationwide than in the metros where the workers are concentrated. On the other hand, for computer and engineering professionals, areas where the workers are concentrated offer higher wages.

This finding is consistent with what the urban theorist Richard Florida has written about the “creative class”: Highly creative workers, such as engineering and computer professionals, tend to be most productive where they can work collaboratively. That is why, even with the marvels of 21^st-century communication, the industries that employ creative workers tend to concentrate geographically. Thus we find Silicon Valley for high tech, Hollywood for movies, and Nashville for music. And where these workers are concentrated and more productive, they earn more. The same does not seem to be true for educators and health-care professionals.

I’m not saying that educators and health-care professionals are not creative, but the nature of their work does not demand constant creativity to the degree that engineering and computer careers do. As a result, concentration of these workers may actually lower wages by increasing competition.

Am I Using a Credential Fraudulently?

You may notice the “PhD” following my name on some of my book covers. I do hold a doctor of philosophy degree (earned, not honorary), but my use of these letters brings up an interesting question of when it is—and is not—appropriate to use work-related credentials. This issue is particularly timely because so many people are now working (or seek work) in fields that they did not prepare for formally.

What raised this issue for me was a question in “The Ethicist” column of last Sunday’s New York Times Magazine. The query, posed by someone whose name was withheld, was this: “A Pilates-certification-program teacher uses the credentials ‘Ph.D.’ after her name in connection with the course description on the studio’s website. However, her degree is in finance, which is never mentioned on the site. Is this acceptable?” The core of the answer from columnist Chuck Klosterman was, “Anyone who includes an academic designation alongside the description of a class she’s teaching is implying that these things have a material connection. She is actively trying to make people misinterpret what she has to offer.”

I admire Chuck Klosterman for his often subtle parsings of ethical issues, and I believe he was correct in making this judgment. So after reading this column, I had to ask myself whether I am using my PhD credential ethically. And as I thought about how to answer this question, I realized that many people deal with a similar issue. Because of my interest in careers, I often ask people how they got into the line of work they presently are doing, and a great many of them describe a crooked career path that did not include the “appropriate” academic training.

As for me, it’s true that I am not teaching Pilates or any other course, but it could still be argued that my use of “PhD” on my books implies what Klosterman calls “a material connection” between my education and the contents of my books. And the fact is that although my books are about careers, none of my degrees is in economics, counseling, psychology, or education. My degrees are all in English literature. (In case you’re curious, my specialization was pre-Shakespearean drama, and my dissertation was about morality plays.) But the particular focus of my academic work, literature, doesn’t really matter. What’s important is that in preparing for and writing my dissertation, I learned how to do research and write about it, and these skills do have a material connection to the work I do now.

You might argue that research and writing skills are necessary but not sufficient qualifications to write about careers; the writer should also be well-informed about career development issues. I often joke that getting a degree in English guarantees that you’ll become informed about career development issues, and in my case there was some truth to this statement. Not long after I got my degree, it became obvious that I was not going to find a permanent job teaching at a university, so I had to decide what else I was going to do with my life. I read What Color Is Your Parachute? and did all the exercises. From my self-assessment, I realized that teaching was not what I liked or was especially good at; instead it was researching and writing, as I had done for my dissertation. The first opportunity that came my way for a job involving these tasks was developing career information for Educational Testing Service. This job led to a 19-year stint. During that time, I engaged in what amounted to an apprenticeship in career development theory, with Martin R. Katz as my mentor. In that setting, the world’s biggest testing organization, it was also inevitable that I would learn a lot about assessment. At Trenton State College (now The College of New Jersey), I took three graduate courses from the counseling master’s program: an introduction to counseling and two educational statistics courses.

Therefore, the credentials I bring to my work are a combination of formal education (mostly the PhD) and on-the-job training (my apprenticeship at ETS), and I try to mention both of these elements on my book covers: The “PhD” appears on the front cover after my name, and on the back cover is a statement that I have been working in the field of career information for more than 30 years.

Many people, like me, are working in fields where their credentials consist, at least in part, of informal on-the-job learning. But most people present their credentials to the world mostly through a business card, which does not accommodate as much text as the back cover of a book. People who work in fields where certification is available as a credential have the chance to put certain relevant initials after their name on the card, but this is not an option in most fields.

If you are working in a field where you do not have formal credentials—perhaps because they do not exist—I would advise you to be hesitant about putting a degree after your name. But I would give you a lot of leeway for arguing (as I do here) that your degree really is relevant to your qualifications.

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.

Comparing a Decade of Income Gains by Education Level

We all know that, as a general rule, the more education an occupation requires, the better it pays. It is also commonly understood that the advantage of a college degree has been growing. This has been demonstrated by surveys that ask people—especially recent graduates—about their education and about their earnings. But how do income gains compare across different levels of education when you look at the issue not through surveys of individuals but rather through groups of occupations?

To answer this question, I looked at the income medians reported for occupations by the Occupational Employment Statistics (OES) program. I grouped the occupations by level of education required as specified by the Department of Labor. Then I computed a weighted average for each level; in a weighted average, the occupations with larger workforce size count for more in the average. I did this for two years: 2002 and 2012.

Here’s what I found:

Education Level	Weighted Average for 2002	Weighted Average for 2012	Gain
High School	$25,119	$37,799	50%
Vocational Training	$29,565	$36,530	24%
Associate Degree	$42,942	$56,917	33%
Bachelor's Degree	$57,137	$71,756	26%
Master's Degree	$44,155	$65,532	48%
Doctoral/Professional Degree	$ 81,022	$106,915	32%

I’ll admit that I was surprised by some of these results.

One surprise was the low payoff for master’s-level occupations—a weighted average of $65,532 in 2012, which is lower than the average for bachelor’s-level occupations. Understand that the set of master’s-level occupations includes many workers who are low-paid considering their required degree. For example, out of 2,197,830 workers, it includes 104,070 Rehabilitation Counselors, with a median income of $33,880; 115,080 Mental Health Counselors ($40,080); and 99,680 Community and Social Service Specialists, All Other ($41,060).

These average figures (both for 2002 and 2012) for master’s-level occupations defy the general trend that the more education you have, the better you’re paid. These figures also contradict the chart created by the Department of Labor showing median weekly earnings of individuals at various education levels, in which people with a bachelor’s average $1,108 per week and those with a master’s average $1,329. (The figures apply to 2013, but you would not expect much difference from 2012 data.) I think the reason might be because the Rehabilitation Counselors and other master’s-level workers with comparatively low annual earnings are more likely to work part-time, and therefore their advantage in weekly earnings would not be reflected in their annual earnings.

Something similar is probably at work in the ho-hum gain (32 percent) for occupations that require a doctoral or professional degree. A large number of these workers are college faculty, and the current trend on campuses is toward greater and greater use of adjunct—that is, part-time—instructors.

The other surprise was in the percentage gains in income. We’ve all heard that wages have remained flat for workers with low education levels, yet the weighted average of high school–level occupations show the biggest gains between 2002 and 2012, and the bachelor’s-level occupations show the second-lowest gains. I think that the reason we find bigger gains for the bachelor’s degree in studies like that done by the College Board is that those studies look at comparatively recent recipients of the degree, whereas the figures I used are based on all incumbents in the occupation. The set of all incumbents includes many workers who have been in the occupation for 20 or 30 years; some of these may have more or less education than the degree that is now recommended for the occupation.

Therefore, young people planning their education should not base their decision on my analysis here. What I show here are trends based on sets of workers that include only small numbers of recent graduates.

Another consideration to bear in mind is that my figures apply only to workers who are employed. They do not reflect the large losses of income experienced by workers in high school–level occupations who became unemployed, as so many did, especially as a result of the recent Great Recession. The large gain 2002–2012 for the high school–level occupations may in fact reflect a kind of Darwinian selection: Workers in these occupations who remained employed despite the Great Recession are probably the ones with the highest levels of skill.