Wednesday, July 24, 2013

A Blueprint for Increasing the Number of Good Jobs in America

Perhaps 50 to 100 million Americans can't or won't be able to sustainably make a living. The unemployment rate of 7.4% doesn't count the millions who are earning at or near minimum wage or who have given up trying to find work

Most of the fastest-growing jobs require high-level skills (like software developer) or often don't pay a living wage (janitor, retail clerk, caregiver, etc.) And ever more full-time benefited, stable jobs are being replaced by part-time contract gigs, automation, or offshored workers.

The disappearance of full-time good jobs has been accelerating for decades, in part because of the growing gap between the cost of hiring an American full-time compared with getting the work done using the approaches listed in the previous paragraph. When an employer hires an American full-time, s/he must pay, for example, Social Security, family leave (paid leave in CA, planned in others), and growing worker-compensation and wrongful-termination claims. Such claims are likely to accelerate further as people get more desperate. And when ObamaCare kicks in, employers will be required to pay thousands of dollars per 30+ hour-per-week employee every year. A likely result will be that many employers will replace yet more full-time workers with part-timers.

The percentage of people unable to earn a stably sustainable living will likely increase further because, on average, the low-skilled poor have more children and because "comprehensive immigration reform" will legalize 11 million people, many whose skills, education, and English language are insufficient to, ongoing, earn a living wage.

Education. The most politically palatable and, in theory, sensible solution is education. Alas, at least a half century of concerted, expensive efforts to close the achievement gap have been far from successful. Yes, school achievement has risen slightly among the poor but the abilities and skills required to consistently earn a middle-class income have increased far more. Low-skill agricultural and manufacturing jobs have declined while high-tech and knowledge work have burgeoned.

I believe our best shot at making education the magic pill we wish it would be is to create Dream Homework: a complete set of dream-team-taught online, interactive, lessons, K-12, available online and used by teachers to replace the reviled standard homework. That way, every child, rich or poor, would be taught daily by some of our most transformational teachers. Thus the school day could be devoted mainly to providing the one-on-one support that only a live teacher can provide.

Job retraining. Job retraining is also an inadequate solution. That too has been tried for decades, with staggering costs and staggering lack of success.

Raising the minimum wage. Instinctively, it feels appropriate to raise the minimum wage to a level at which people can live decently. Unfortunately, many people don't add even minimum-wage value to employers. For example, many people learn slowly, are unreliable, alienate coworkers and customers, steal, and/or have serious physical or mental disabilities. Many employers would pay to not hire such people, so their net value to the employer is less than $0! So if the minimum wage were raised to, for example, $15, many more low-skill workers would be unemployed. Employers would think about many employees, "This person doesn't add enough value to my workplace to justify $15 an hour plus all those benefits and risk of employee lawsuit." True, raising the minimum wage to $15 would improve the lives of millions of Americans who are paid less than $15 an hour plus benefits but who are worth at least that. But a "living wage" would also render unemployed millions of would-be workers who add less than $15 an hour of value.

No one approach will solve this problem. Candidly, I'm not convinced that even implementing all of the following would make those 50-100 million people consistently earning at least $15 an hour plus benefits. But these are my best shots at what would help.

K-16 entrepreneurship education. New businesses create jobs, so teaching students the art and science of entrepreneurship should create jobs while abetting society. Of course, the school curriculum is already packed. So what could entrepreneurship education replace? Replacing one or two days a week of physical education with entrepreneurship education might offer the best tradeoff. 

That said,, unlike entrepreneurs of previous generations, those who create websites, software, etc, create few jobs: A few geniuses are needed to create the first product. Then unlike traditional manufacturing, it's reproduced and distributed electronically, no people required. Yeah, a few marketers etc. are needed but no major increase in employment, especially for those with intellectual, social, and emotional capability below the 90th percentile.

Three-year easing of regulations for new businesses. (suggested to me by Robert Neuwirth.) Many people contemplating starting a business are daunted by the government-imposed costs and regulations. A temporary easing could create more businesses and, in-turn, jobs. 

Taxpayer-funded jobs.  I envision a WPA-like program, in which taxpayers fund an Assistance Army that would, for example, build infrastructure, bring more tutors to K-12 classrooms, provide better in-home support for shut-in seniors, beautify riven inner cities, and fund visual and performing artists to enrich their community. 

Reducing taxes on small business. The public is not aware that America's 30 million non-corporate businesses pay taxes at individual rates. The average top marginal rate for the 23 million sole proprietorships is 47.5 percent, higher even that the rate for the 7.3 million S-corporations of 44.5 percent. That kind of tax rate on top of other employer mandates from Workers Comp to Social Security to ObamaCare provides a major disincentive to hire more workers. 

Nanopayments. Jaron Lanier, in his new book, Who Owns the Future?, argues that much work goes unpaid and could become so. For example, millions of bloggers, tweeters, digital photographers, Amazon review writers, YouTube video uploaders, etc. might be able to make at least sideline income by charging pennies per view, automatically charged to a user's credit card. It's difficult to envision enough of the public being willing to pay even a penny for what they currently get for free but the benefit of such a system would be so great that I believe it's worth a societal effort to try to make nanopayments the norm. A smaller version of this already exists on Amazon's Mechanical Turk, and for $50-100 projects on, and for $100 to $1000 projects on standard freelancer sites such as,, 99designs.comand

Encourage the share economy. Websites are helping people make money by sharing what they already own: their home (AirBnB, car (RelayRides, getaround, zipcar, Uber) and money, for example, Kickstarter.

Get the public to embrace patchwork careers. Of course, full-time, stable jobs offer advantages: Many people like having a routine, a regular place to go to work, a job they can grow comfortable in, coworkers that become friends, whom they pass the years with. Alas, such stability may be impossible for many of those 50 to 100 million people and perhaps for many others. 

Many people so dislike the idea of earning their living from multiple part-time, low-pay, often temporary jobs that they'd rather be unemployed. Other people are daunted at having to look for multiple jobs, perhaps frequently. Those are legitimate concerns but patchwork careers do have advantages, for example, variety, flexible schedule, and more learning opportunities. Perhaps a campaign of public-service announcements, a la the anti-smoking and anti-drug-abuse initiatives, might convince more people to pursue a patchwork career.

Get the public to learn to live on less. As said earlier, I fear that all of the above will only partially address the problem. So I believe the public needs to realize that The American Way--trying to spend your way to happiness--may be not only unrealistic but unwise if not a downright fool's game. Beyond the basics, most people find contentment through rewarding work, relationships, and creative outlets, not buying that brand-new car or 20th pair of shoes. 

Dear reader, I welcome your ideas and your reactions to mine.I plan to send a revised version of this to Jaron Lanier in advance of his appearance on my radio program, where we will, on-the-air, brainstorm a plan for increasing the number of good jobs in America.


Dave said...

I think a lot of the problems employers are having to deal with today -- lack of discipline, unethical behavior, perfidia, no loyalty, general laziness, etc. -- stem from two things:

1. The decline of the family, general social breakdown.

2. The decline of the churches and religion/piety in general.

These two lead to the third thing:

3. Decline of primary and secondary education, mostly due to tardiness, no parental support and encouragement, no moral grounding -- hence general student apathy

A stable family life (ie. a 'marriage culture'), strong church influence which produces a moral monopoly on the human conscience (ethical workers) and organic continuity in society -- These critical institutions serve to enrich our society, producing ethical, disciplined, selfless, loyal individuals that add material and spiritual value to our society.

Maria Lopez said...

I don't know if the family has declined among college educated folks. For instance, though the marriage rate has gone done the divorce rate, I believe, has also done so. Cause and effect are difficult to tease out here.

Also church seems to me, at best neutral, in influencing people to work. While agricultural work is always in the background in both the Hebrew Bible and the New Testament, Jesus essentially never praises work and one occasion praises idleness.

This is not to say that many ministers don't encourage work or that essentially all religions don't urge one not to steal.

I believe that there is an essential desire in most humans to do well by their fellows. Interpersonal evil exists because this desire is not absolute and is not as strong toward strangers as it is toward neighbors. Religious practice might encourage this tendency but I think that it is inessential.

Dave said...

I respectfully disagree. The Soviet Union, a country that officially professed atheism, pretended to pay its workers while the workers pretended to work.

Christianity has gone through periods of transformation over the centuries. The Reformation brought about the so-called 'Protestant Work Ethic', which did away with all the saints days. There were so many saints days prior to the Reformation, that very little work was ever accomplished. Compare Catholic Spain and Ireland to Germany and the UK.

"The Protestant work ethic (or the Puritan work ethic) is a concept in theology, sociology, economics and history which emphasizes hard work, frugality and diligence as a constant display of a person's salvation in the Christian faith, in contrast to the focus upon religious attendance, confession, and ceremonial sacrament in the Catholic tradition......Hard work and frugality, as well as social success and wealth, were thought to be two important consequences of being one of the elect; thus, Protestants were thus attracted to these qualities and supposed to strive for reaching them."

Three things undermine marriage as a child-bearing institution and lead to social breakdown.

1. Cohabitation.

2. The legal equalization of cohabitation with marriage.

3. Gay marriage.

The consequences: An increase in single parent families; increased burden on social welfare services; juvenile delinquency; the violation of the natural rights of children.

Maria Lopez said...

So you are saying that Protestantism as distinct from Catholicism promotes work due to the intrinsic uncertainty Protestants have towards their salvation status.

I agree religion can make a difference, I'm just saying it is inessential. I've seen or heard about it doing both good and evil in people's lives. For instance, believe that it has helped at least some addicts greatly, including one who knocked out her young child so she could steal drug money from him.

I also believe that it has harmed other people especially those prone to depression, who sometimes cannot shake the fear of hellfire and increase their misery with worries of damnation.

I also don't know that gay marriage is harmful to kids. I've known happy, apparently well cared for, children from lesbian households.

As for cohabitation, I believe such arrangements are less likely to last than formal marriages, but if they do last, I see little evidence they harm children.

Now, I do think their is a subset of Atheists who do very badly. These are people who don't go to church or religious institutions because they don't respect anything at all outside themselves. They often don't have any sort of rational disagreement with religion but simply don't want to follow any rules.

Of course, not all psychopaths are atheists. I can think of two very nasty murderers who were, in essence, Christian heretics.

Dave said...

Re Salvation: Yes, I do believe that is the case.

Christianity is the wellspring of our culture. Philanthropy, social justice, democratic governance -- these things are found in the Bible (eg. Amos, Epistle of James). Studies have shown that religious people are more charitable.

Re: gay marriage -- I am suspicious of social engineering experiments; however, that's beside the point. Natural rights should be the chief concern here. It is every child's natural right to be raised by his/her natural biological mother and father, as it is also the case that every father and mother has the natural right to raise their biological child. In a case in which this is not possible (eg. death, abuse), a natural substitute must be found. Sperm donations and gay adoption are violations of that natural right. My argument is mostly based on natural rights, not morality. However, I do believe that depriving man of his natural rights is immoral. I think it is foolish to ignore the wisdom and experience of those who came before us. An old saying --
"He who marries the spirit of this age will find himself a widower in the next."

Re: cohabitation -- Sure. If they last. The Soviet government thought it unnecessary to encourage marriage since it felt that the institution was only a by-product of the church. This proved to be a serious error. Too many families split, nearly bankrupting the government. The end result was Stalin's marriage act of 1933.

ST said...

Of course, debating religion and "family values" has never been a winning proposition. There are countless examples on both sides to show they are moot points as far as job creation. I do agree with Maria that in the corporate offices where I've worked with mostly college graduates, the traditional family is more prevalent.

I think there's a distinction of multiple "jobs" versus multiple "income streams". The latter is much of what you do, Marty. From the examples I know of people who have multiple "jobs", it is not fun. The problem is, you have to actually be at the place of work at multiple places. You're going to be at work where the boss is. And good scheduling, not so much. Sure, you can work in an office during the day, and at a restaurant or two in the evenings, one during the week and one during the weekends. But, it is a nightmare to schedule not to mention the exhaustion.

With your work with scheduling clients, going to radio shows, etc., at least you can schedule clients around when the radio shows are, for a simple example (not knowing all you have going on). I guess it depends on how much control you have over how you make your money (which tends to be more entrepreneurial). If you do computer coding for multiple clients, you can essentially stay home, unless they require meetings in person once in a while.

I also agree America spends way too much money on "stuff", but trying to make them give it up is like trying to get kids off their smart phones. I don't know what will happen. People are still driving gas guzzling trucks by the droves, even though we don't know how much oil reserves we have left. People are buying Prius too, but it's amazing how many big trucks and SUVs I still see. They want big and tall.

I don't know about nano payments, either. People are so inherently cheap, the mere thought of spending a penny to view a web site might make them not view it (as they search for their next big truck online). It's like being penny wise and pound foolish. They worry about spending a few cents more for a meal in the work cafeteria versus going out to a fast food place, yet every month $100 is being sucked out of their bank for their cell phone bill.

Dave said...

Religion and family 'values' are things that help make people employable. This is one of the challenges facing the African-American community, which is largely bereft of a marriage culture. More than two-thirds of African-American children are born out of wedlock. The consequences of this are high unemployment and a high incarceration rate. We are now witnessing the breakdown of marriage among every race. The proliferation of white single-parent households has increased dramatically in recent decades. Just think of the effects this will have on America's labor market in twenty years. The US will have more social ills and more people who are not employable.

As for today's eco-friendly cars -- They may perform as promised, but the auto industry no longer builds cars that are aesthetically pleasing. Today's auto design teams do not have any sense of style and proportion. Overpriced vehicles with garish-looking wheels and grilles won't lure me into a showroom.

Maria Lopez said...

So what does religion mean anyway? Is Confucianism good enough or does it have to be Protestant Christianity?

Seriously, While Communism was indeed Atheist, didn't the problems with the Russian economy stem from the fact that a free market is often better able to align incentives with human needs and wants than a totally centralized system?

Also, I find economic arguments for religion suspiciously irreligious. After all, isn't religion about having a beneficial effect on your soul more than it is about improving the economy. If that is all that it is for, wouldn't state religion that doesn't mention any supernatural figures but preaches industriousness be as good as any?

Dave said...

"After all, isn't religion about having a beneficial effect on your soul more than it is about improving the economy."

I agree with you. I also believe that it is in the best interest of the State. Religion helps to foster discipline, commitment, and builds a strong moral foundation. The divine element in the equation is critical. An employee may be able to steal something in his workplace without anyone ever finding out; everyone but the man upstairs, that is. That's an effective deterrent for those who believe in the existence of an omnipotent, all-knowing divine being.

Earlier, I simply alluded to the fact that a society's providential worldview (mainly theology) is simply the pre-determined 'outcome' of said society, not necessarily the desire. Arab and Pakistani societies are products of the theology (Islamic theology) of their peoples - hence the theocratic nature of their governing structures, political culture.

On a side note, you could also argue that the existence or non-existence of God does not matter; rather, the 'idea' of the existence of God is of greater importance. A minister at the Riverside Church in Manhattan made that argument in the 1930s. I don't remember his name.

I didn't address the problems of the Soviet economy. I simply stated that social breakdown in the Soviet Union overwhelmed social services. I saw the same thing in the free market economies of Western Europe. The ever growing number of single-parent households in England, which has one of the highest levels of teen pregnancy in Europe, are a heavy burden on the UK's social welfare system. Pre-marital sex and illegitimate pregnancies were once shameful. Well, times have changed and what was once considered sinful and shameful, is now widely accepted and even encouraged. Juvenile delinquency is an unfortunate outcome. There's a lot of crime there.