America the Jobless

To keep clients from giving up, career counselors need to appear optimistic. And to avoid our feeling disingenuous, in reading the tea leaves, we unconsciously tend to overweight the positive.

But I just read the cover story of the March 2010 issue of The Atlantic: "How a New Jobless Era will Transform America." (Thanks to reader Scott Steinbrecher for emailing it to me.) After reviewing a wealth of research, it concludes that, especially for men and for people without a designer-label sheepskin, ever fewer people will be earning a middle class living.

The article's negativity somehow gave me license to, for this article at least, to replace my optimistic bias with a truly honest appraisal of America's job future.

My career counseling clients, especially the men, are having a helluva time landing a decent job. Perhaps I'm a lousy career counselor or my clients are a bunch of losers but I don't believe either. I think the unemployment rate and even the underemployment rate grossly underestimates how difficult it is to land a white-collar job that pays a middle-class wage.

The severity of the problem is made clear from an example cited in that Atlantic article:

Last spring, an organization called JobNob began holding networking happy hours to try to match college graduates with start-up companies looking primarily for unpaid labor. Julie Greenberg, a co-founder of JobNob, says that at the first event, on May 7, she expected perhaps 30 people, but 300 showed up. New graduates didn’t have much of a chance; most of the people there had several years of work experience—quite a lot were 30-somethings—and some had more than one degree. JobNob has since held events for alumni of Stanford, Berkeley, and Harvard; all have been well attended (at the Harvard event, Greenberg tried to restrict attendance to 75, but about 100 people managed to get in), and all have been dominated by people with significant work experience.When experienced workers holding prestigious degrees are taking unpaid internships, not much is left (for everyone else.)

And it's not surprising. Unless absolutely necessary, why in the world should an employer pay an American $50,000-$100,000 a year, plus benefits including health care, social security, disability, retirement, worker's comp, 12 weeks unpaid (and some in the Obama Administration want it to be paid leave.) unemployment insurance, fear of wrongful termination suits, etc., etc.? Increasingly, employers are choosing to get work done by automation, part-time/temp workers, and offshoring. The latter is becoming ever more prevalent even for the previously thought-to-be-immune knowledge work, as Asian universities are revamping their curriculum to emphasize creativity, entrepreneurship, etc. And all those Asian workers can be hired for a fraction of the cost of an American.

Too, the uncontrolled inflow of illegal immigrants exerts downward pressure on salaries. The average illegal immigrant has little education and poor English skills and so is willing to do low-level jobs, on which they pay little or no tax. That floods the market of applicants for higher level jobs thus driving their salaries down, and making it harder to land a job at all.

I don't believe there's a solution that won't require decades. In a previous article, I've touted using K-16 schools to create a nation of entrepreneurs, but that would require a generation or two. Until American wages and benefits decline to near the world average, unless you're a star, the main source of well-paying jobs will be self-employment (often risky) and the U.S. government. And those jobs will dwindle as there's less worker income to tax and the government must stop going deeper into debt and printing more money lest China and other lenders deem the U.S. utterly credit-unworthy and/or call in their existing loans to us.

For the foreseeable future, ever more Americans will have to settle for $10-an-hour jobs, living very modestly, paycheck to paycheck, with little or nothing saved for retirement. We'll work 'til we drop...if we're lucky enough to have a job. It's part of the decline and fall of the American empire.