I thought this was a really interesting article, again by the NYTimes, about the shift in the kinds of jobs that people are getting. Using the example of Uber - a company that has contractors that are the core of the service, and how many companies are looking to have contractors and outside people to fulfill the roles necessary to run the company. This article begs the question of where do we as an economy see ourselves going in say the next 5 to 10 years? also where do you see yourself. As an "alternative arrangement" or as a full time salaried employ?
http://www.nytimes.com/2016/03/31/upshot/contractors-and-temps-accounted-for-all-of-the-growth-in-employment-in-the-last-decade.html?ref=economy
This is tangentially related to the argument regarding the future of U.S. jobs. Donald Trump insists that he will stop shipping jobs overseas, but is this for the best? Does the U.S. want low-skill jobs, or should we focus on creating skilled, long-term positions? In my opinion, the U.S. would be better off sending low-skill jobs overseas for cost efficiency. Our focus should be on education and innovation so that we can pay better wages. Uber is an interesting concept because it arose as a result of the inefficiency in the taxi market. Uber drivers are now attempting to form unions to demand higher wages. What do you guys think of this? Do we still need labor unions to protect low-skill jobs?
ReplyDeleteI largely agree with this. There is one thing that I am worried about though. With the inequality in educational outcomes that we see I think that high paying, low skill jobs work as an important stepping stone for people. The people who fill the role are not well educated but their children have a much better chance to be. I don't know if there is any good empirical research that has found evidence of this theory, but creating better equality in access to quality education (throughout your whole life not just college) would dissuade my fear of this idea. If anybody knows of some, I'd love to see it.
DeleteI think it is too early to tell if "alternative arrangement" jobs will be the future for those with low skills. I am of the belief that the Uber business model has not been proven due to the fact regulations are starting to bubble up. If this is the case, prices will go up and less people will use or work for these types of businesses.
ReplyDeleteThis could probably be true for many other types of alternative arrangements as well. Only time will tell what the equilibrium is in the labor market.
Link: http://www.motherjones.com/politics/2015/09/your-cheap-uber-rides-may-soon-be-over-heres-why-thats-good-thing
I believe that these types of jobs are appealing to many people in addition to low-skilled workers. Since millennials are now entering into the workforce and our ideas of what we want in the workplace are different than the Gen X or Gen Y'ers, these types of jobs could increase over the next couple of years. I believe that the workforce is evolving and I am glad that the low-skilled workers have options for jobs, because if we don't have these types of jobs for those who are less skilled, those highly-skilled workers will not want to do these types of jobs. So either they will be forced to take these low-skilled jobs in order to work, or these jobs will not exist. I'm not sure how this would benefit society.
ReplyDeleteWhat I found really interesting in the article was the discussion about insurance and how employers want to provide their customers with insurance. I can see that this is a tool to draw people in to work for the company since companies like Uber rely heavily on people to keep the company alive. I am wondering if the Health Care policies Bernie Sanders is proposing is appealing to these companies or prospective employees.
I worry about the impact of companies like Uber on the job market. Dealing with unions as an employer is a frustrating experience. Yet, I believe that unions protect worker rights. It is a monopsony issue. I thought Rachel's comment was interesting. If Uber doesn't have to pay for health care for its employees who are paying for it themselves through higher taxes, then that has to be good for the company. I also think it is good for the economy. Firms providing health care insurance is a historical accident. There is nothing efficient about it.
ReplyDeleteI believe that these alternate arrangements such as Uber make the future job markets very cloudy. While Uber has been a relatively successful company, it is still fairly new and has endured its ups and downs. The case of Uber is especially interesting due to the controversy of weather the drivers should be considered contractors of Uber, or if they should paid as employees. For example last year there was a case where the state of California said Uber drivers were employees and not contractors. I think it will be interesting to see if other states follow their lead or if they continue to consider drivers as contractors.
ReplyDeleteHowever, while the future of Uber and other "alternate arrangements" are cloudy, I agree with Rachel in that there must be opportunities and options for low skilled workers. If all low skilled jobs are sent overseas, and only high skilled jobs are present, what will happen to the necessary low skill jobs that present, and what will happen if focusing on education is not the easiest solution? If the plan is to keep only high skilled jobs in the U.S, could companies potentially be hurt because they would not have the ability to recruit better job candidates internationally?
http://www.nytimes.com/2015/06/18/business/uber-contests-california-labor-ruling-that-says-drivers-should-be-employees.html
Bharath, I agree with you that the outlook of this type of employment does seem unclear, but I'm not sure that we should worry too much about shortages in the market for lower-skilled jobs. If too many people leave the market, wages will rise as long as the market is still relevant, and people will eventually return. For instance, there is an extreme shortage of welders in the US right now, and according to this article, http://www.usatoday.com/story/money/business/2012/10/21/welders-shortage/1641073/
Deletewelders can be making 80,000 a year without a college degree, at the age of 19. Maybe I should consider a new career path...
Throughout the past couple decades, there has been an increased emphasis on higher education, and it has taken a toll on certain job markets such as this. The industry's reaction in increased wages is just a signal that when demand is high and quantity supplied is low, price will go up. In this situation, focusing on higher education doesn't seem like the right thing to do!