I would like to write specifically about some pressing economic trends that have led me to think deeply about the importance of supporting my daughters in their educational and future professional goals. My concern is colored heavily by my professional life as a professor who specializes in studying the changing nature of work, human resource management practices, and the labor market. While I hope to write some more in-depth articles that explore important changes in the economy and world of work as they relate to the choices facing LDS families and women, today I want to share in broad strokes three basic facts about the modern US labor market that all women and their families should know. The reality is that young LDS women and families face a very different economic environment than that experienced by their parents and grandparents – and they need to be prepared for it.
In the 1950s through roughly the late 1970s, as the American economy grew, its prosperity was shared broadly among US workers. This meant rising living standards and family-sustaining jobs were an increasingly reasonable expectation for many American families. Even with a high school degree, with some initiative, good choices, and hard work it was reasonable to expect a man to make enough money to afford a home and support a family or be on his way to obtaining such a job. However, this changed dramatically through the 1980s continuing to today. The American economy and its productivity has continued to grow, but median wages have stagnated (see graph 1 and the captions for details on how to read and interpret it).
[Productivity represents the total economic output of the US economy divided by the number of labor hours.Average hourly compensation includes things like bonuses and benefits. Average hourly wage, just base wages.]
In place of the widespread sharing of productivity gains, the vast majority of these gains have gone to those in the top 10% of the income distribution, though even most of these have gone to the top 1%. Together these changes have led to a more and more polarized labor market with some amazing, phenomenal jobs at the top of the market and deteriorating job quality at the middle and the bottom.
[Source: Saez and Picketty see http:/[Source: Saez and Picketty see http://elsa.berkeley.edu/~saez/ for papers and data. The basic idea here is that those who are the top 1% of income (the triangle line) went from having under 10% of the total income in the country in 1978 to almost 25% by 2007 (where the graph ends). “You can see the other era in which such a small percentage of the population was the benificiary of such a large portion of income in the country was in the roaring 20’s right before the Great Depression. The data is taken from income tax records and considered established fact by economists.”]
This change in economic dynamics has had far ranging consequences for families and especially for LDS women. For example, almost all gains in household income for the average American family in the past three decades have come from married women entering the workforce. For many, if not most of these families, this income hasn’t been to buy luxuries, but rather a necessity to pay basic bills and provide long term financial stability to families such as retirement accounts, emergency savings, and college savings for children, etc. The hollowing out of middle class jobs has also meant that it has become increasingly difficult for a woman (or man) without a college degree to enter the workforce and make a family-sustaining wage (or even enough to have something left-over after child care). Even more dramatically, these two trends have created a situation where the widely accepted approach for LDS women to get a college degree in part to act as a “backup plan” is simply not sufficient to provide the potential for a family-sustaining wage. Without a well-thought out career plan that includes the consideration of not only obtaining an employable degree, but also a concrete plan for how to gain critical work experience and keeping skills up-to-date, families will find that many bachelors degrees and even some graduate degrees will fail to provide needed employment. Barring a dramatic change in the structure of the American economy, this is simply a new economic reality. If my daughters don’t prepare for it by aspiring to develop some of their talents and interests into market-recognized skills, they risk a life of economic uncertainty and dependence. A risk that is rising.
Compounding the first trend is a second one that is often overlooked in worries about wage levels. Simply put, in the past two decades more and more of life’s risks have been shifted directly on to the backs of families as the economic institutions built in the 1950s that provided a foundation of stability to workers have eroded. This has happened in a number of significant and measurable ways. For example, in the 1950s through 1970s lay-offs happened almost exclusively in firms that were losing money and in serious financial peril. It was common, accepted practice for many organizations to buffer their workforces from temporary fluctuations in the business cycle. It was rare for a profitable company to lay-off workers. These two interrelated realities shifted in the 1980s. Now being employed by a profitable company no longer buffers many full-time workers from losing their jobs and firms have increasingly moved to using temporary and contingent workers precisely because this makes it easier for the firm to use their workforce to mitigate the organization’s own risk.
Concurrently, the cost of health care and health insurance have systematically been moved from firms and government back onto families. This makes it harder for families to plan on stable employment and more likely for even well-employed individuals to find themselves with significant spells of unanticipated unemployment or with employment that doesn’t provide them with basic insurance against illness. Similar increased risk can be seen in the structure of the retirement system. Aside from mere wages, these types of employment risks put huge stress on families. These days more and more people are finding themselves doing everything right – working hard, getting educated, finding jobs with well-performing employers and living within their means. Yet, they are more likely to need a second income or have good reasons to want to diversify their income and benefit risk so that at least one parent has a job, health insurance, and is saving for retirement.
The long story short is that not only has the labor market become increasingly divided into a smaller number of really good jobs and more and more poor quality jobs, but the probability that my daughters will need or want a job to help support their families has risen substantially with no signs of changing. The probability that my daughters meet and marry men with family-sustaining jobs is lower than it might have been in the past, and even then, such employment is more at risk.
The first two trends paint a stark and harsh picture as to why I want my daughters to aspire to good careers. The third trend is a more optimistic one. The opportunities for women to compete as equals in the labor market have never been better. Gender discrimination in all forms has been decreasing. As President Hinckley correctly noted, “The whole gamut of human endeavor is now open to women.” Certainly there are still some occupations, organizations, and entrenched dynamics that continue to provide resistance, but overall there is every reason to believe that by the time my girls enter college their gender will provide little constraint in their economic opportunities. The real constraint that they will more likely face is trying to balance work and family life. Often in a Mormon discourse, this conflict is presented as largely unresolvable, especially for women. And truth be told, in the United States there are still lots of barriers and difficulties faced by two income families in achieving this balancing act. However, I really believe that by the time my daughters enter the workforce there will be substantially increased opportunities to carve out a life that does not make one choose between a career and nurturing a family. These niches and jobs already exist in today’s market. Often the trade-offs are steep and demand for these jobs greatly outstrips supply. One reason I want my girls to aim high is because most opportunities for good, flexible work exist in higher paid jobs and careers. This is where the fastest and most widespread change will continue to occur because employers see flexible work arrangements and other family perks not as a moral imperative to provide their workers, but as an important competitive perk needed to attract the most desired workers. This poses a paradox where the most ambitious women will have the most appealing, flexible career options available to them, though they are probably going to have to compete for such opportunities. There are still many, many issues to be worked out, but all the trends are pointing in the right direction, especially for those with professional degrees and a track record of high quality work experience.
At the end of the day, I want my daughters to have options. They may be fortunate to find themselves in a situation where they can reasonably plan on dedicating themselves to raising their children full-time, as my wife has for many years. However, if so, they will be among a decreasing number of the fortunate families for whom this is a reasonable option. Alternatively, they may choose to sequence their careers with being a stay-at-home parent or simply choose to work part-time or full-time. They may get married early or late or never. Whatever they decide, the economic landscape (unfortunately, I think) points to a world where as a father, I feel I would be abdicating my responsibility if I did not prepare my girls to aspire to find a place outside the home and in the modern labor market.
Ryan, a professor of management who studies the world of work, is on the board of Aspiring Mormon Women. He currently lives in Seoul, Korea with his wife and 4 children, including 2 aspiring daughters.
Image credit: Money, Money, Money | Charles Meurer, 1898