PLAN OF MY TALK

• The outcomes we care about

• The myths that block action

• The economic context

• Programs to move us forward

• Beyond programs: building support

THE BOTTOM: EXTENT OF LOW WAGE WORK AMONG ADULTS

Below 2/3 of median wage

Below Poverty wage, family of 4

0%

5%

10%

15%

20%

25%

30%

24%

19%

Source: Osterman

THE MIDDLE: EMPLOYMENT TO POPULATION RATIO, 25-54 YEAR OLDS

SOURCE: BUREAU OF LABOR STATISTICS

FALLING EARNINGS: FULL TIME AND FULL YEAR WORKERS

2002 2012

Men $50,323 $49,398

Women $38,548 $37,791

And losses cut across all groups but are worse for Hispanics and African-Americans

MYTH 1: BAD JOBS ARE TEMPORARY

MYTH 2: IT IS ALL EDUCATION

MYTH 3: BECAUSE OF POLARIZATION THE ONLY GOOD JOBS LEFT WILL BE OUT OF REACH OF MOST PEOPLE

MYTH 4: INTERVENING MAKES THINGS WORSE

SO, PROBLEM IS STRUCTURAL. WHAT HAS HAPPENED?

EDUCATION AND SKILL

Unequal educational outcomes

COLLEGE GRADUATION RATES FOR HIGH AND LOW INCOME CHILDREN

CHANGES IN HOW WORK IS ORGANIZED

New Pathways

Paradoxical (and disturbing) behavior by mainstream employers

Low wage employers resist efforts to raise the floor

BUT WE CAN’T JUST MAKE FIRMS THE VILLAIN

THE BROKEN SOCIAL CONTRACT….

Growth in Productivity, Household Income and Average Hourly Earnings

50

100

150

200

250

300

350

400

1947

1950

1953

1956

1959

1962

1965

1968

1971

1974

1977

1980

1983

1986

1989

1992

1995

1998

2001

2004

2007

Inde

x (1

947=

100)

Average Hourly Earnings

Household Income

Productivity

PART OF THE PROBLEM IS ALSO THE BROKEN SOCIAL CONTRACT

Source: Generated from data provided by Larry Mishel, Economic Policy Institute

HOW TO ADDRESS THESE CHALLENGES

Strengthen skills system, especially community colleges

Make bad jobs good

Create more good jobs

Organize, and also create a powerful narrative

THERE IS AN OPENINGThe labor force will grow only slowly

Increase age 25-54 1980-2000

35 MILLION 2000-2020 3

MILLION

Because firms are reducing their internal investment in skillsthey are looking for help from schools and intermediaries

SO, MOVING FORWARD

PROGRAMMATIC STEPS

• Fix Human Capital system: Community Colleges

• Update and enforce labor standards

• Policies that work with firms

COMMUNITY COLLEGES

STANDARDS

PROGRAMS THAT WORK WITH FIRMS

BUT

These are all programs. In fact we know what works or, at least, what is very promising.

What is missing is the BROAD BASED SUPPORT to make it happen.

MAKING IT HAPPEN

And finally, this talk wouldn’t be complete without a picture of my new grandchildren (identical twins, along with my daughters)….

THANK YOU