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HOURGLASS ECONOMICS?
JUNE 7, 1996
TRANSCRIPT
As students graduate they find career ladders broken apart and fractured, but experts say work can still be rewarding. Paul Solman leads a discuss with a panel of job experts.
NewsHour analysis of economic statistics in May, 1996.
The NewHour's regular panel of historians discuss trends in economic insecurity.
PAUL SOLMAN: Today's employment report showed a strong rise in the number of jobs created in the nation last month, and the unemployment rate, while rising a bit in May, remains near its recent low. But who gets today's jobs and what kind of jobs are they?
With high school and college students now looking for summer work or preparing to start a career after graduation, we thought we'd ask how the numbers translate into experience for young people and so for that we're joined by Audrey Freeman--Freedman, sorry, a labor economist who has her own consulting firm in New York and works with businesses around the nation; Simone Taylor is director of career planning and placement at the University of Michigan; Margaret Hayes is the executive director of Jobs for Youth, a non-profit organization in New York; and David Pierce, here with me in Washington, is president of the American Association of Community Colleges, which represents about 100 and--well, 1100, I guess that is, accredited two-year colleges around the country, and so welcome to you all.
First, Audrey Freedman, let me start with you. This business report that they got 348,000 new jobs, or they added 348,000 new jobs in May, yet, the unemployment rate also went up, so how do those numbers jibe? How do we make sense of that?
AUDREY FREEDMAN, Labor Economist: (New York) Well, they don't match up. They really never have matched up. The payroll numbers can, can, in fact, count somebody twice, somebody who has two jobs. And there are about almost 8 million people who work more than one job. They would be counted twice in the payroll numbers, but in the other survey, the survey of families and households, you would have one person say, yes, I have a job, but they might be employed in two different places.
You also get in that count people who are self-employed, so that the counts don't match up. But what happened actually was a tremendous increase in the number of payroll jobs, 348,000 was more than twice what we were expecting, and most of those jobs are in services. So a lot of them are going to be available for young people this summer. They're going to be temporary help jobs, temporary jobs in retailing, and other kinds of personal services that are short-term and that will be available to students who only want to work for the summer or to people who are entering the labor market for the first time.
PAUL SOLMAN: So are those second jobs, some of them? I didn't quite understand you.
MS. FREEDMAN: I was pointing out why the two counts don't match.
PAUL SOLMAN: Right. But are those--are any of those second jobs, those 348,000, or are those new jobs?
MS. FREEDMAN: They might be. They're new jobs. They're additions to the whole payroll total for the United States. And most of the new jobs are in services. A lot of them are in retailing. A lot of them are in temporary help occupations.
PAUL SOLMAN: Uh-huh.
MS. FREEDMAN: And office work and data processing and engineering and engineering assistants. Some of them are in construction, not very many, hardly any in manufacturing, but this is the kind of job that people get on, on a summer basis, for example, a service job in retailing and this is the kind of jobs that young people just getting out of school will get perhaps on a short-term basis. But there are plenty of openings for them, and the economy is producing thousands of jobs.
PAUL SOLMAN: Well, let's go around the country and find out. You're at--let's see--Simone Taylor, you're at the University of Michigan, right?
SIMONE HIMBEAULT TAYLOR, University of Michigan: (Detroit) Yes.
PAUL SOLMAN: So what's the situation like for people just coming out of school, just graduating, either summer jobs or, I guess, full-time jobs for some part of the rest of their life?
MS. TAYLOR: Actually, we're quite optimistic on both counts. It's very encouraging to see the amount of activity that's occurred with employment this past year. Our own recruitment through our office is up 37 percent, and of those, most of them represent new employers to our institution. It's a very encouraging sign, I think, for our students, our recent graduates, and for future graduates.
PAUL SOLMAN: Have recruiters been coming there less often in recent years? Is this a big sudden uptick, or is it a trend?
MS. TAYLOR: There has certainly been a national decline over the past I'd say decade, which has been experienced by my colleagues across the nation, and, umm, I think that what we are experiencing at the University of Michigan is fairly typical of what's happening nationally as well, where we're seeing a--I believe--resurrection, hopefully, of the labor market in terms of available opportunities for recent college graduates.
PAUL SOLMAN: What kinds--briefly, what kinds of jobs are they getting, and what salary are they getting, Simone Taylor?
MS. TAYLOR: Certainly that varies quite a bit by type of major, type of degree. If we're talking about undergraduate students, uh, with a business degree, uh, they have done very, very well this past year, umm, especially in the accounting field, consulting, information area, and they're probably, uh, averaging salaries between thirty and thirty-five thousand dollars.
PAUL SOLMAN: What about liberal arts, typical liberal arts?
MS. TAYLOR: Liberal arts students are a very exciting group, I think, and certainly a group dear to my heart, and, uh, are faring I think quite well, as well in the labor market. Their charge to find a job is a little more challenging than the technically skilled, umm, technically trained student. It probably takes them approximately six months to secure employment, but at least at the University of Michigan and the students we have surveyed, students who were in the job market last year after six months since graduation, umm, 89 percent of those students were employed, and of those students, about 90 percent indicated that they were in jobs with career potential. And we see that as a very encouraging sign for our students.
PAUL SOLMAN: And how much are they making, roughly, coming out, liberal arts now?
MS. TAYLOR: It varies so much by field--
PAUL SOLMAN: Average.
MS. TAYLOR: --that they go in. On average, I would say low to mid 20's.
PAUL SOLMAN: Low to mid 20's.
MS. TAYLOR: But it really varies by field.
PAUL SOLMAN: Sure.
MS. TAYLOR: In publishing it might be the high teens, in consulting it might be the high twenties, low thirties.
PAUL SOLMAN: Let's not talk about public television. David Pierce, community colleges, two-year courses, what do you find is happening with your new graduates who are somewhat older, of course, than I guess some of the other people?
DAVID PIERCE, American Association of Community Colleges: Well, Paul, for the last several years, we've had an excellent placement pattern. We've been experiencing close to 95 percent of our graduates have been employed within 30 days after receiving their degree, and this year, the employment prospect is a little stronger than that. And so we're very upbeat about things, and, of course, today's report is also good news because our, our students will have better opportunities to get summer jobs, and, uh, support themselves in their, in their next year's work and their transfer work going on to university.
PAUL SOLMAN: Okay. So Margaret Hayes now you're in New York, and your program serves at-risk people and kids, I guess, younger basically than the last two people we've heard from, lower-income kids. What's happening to that?
MARGARET E. HAYES, Jobs for Youth: (New York) Well, we find that again, as was said previously, that the service industry is where the jobs are, and we're preparing them and placing them in a lot of service industry jobs. With the build up of tourism, there seems to be more jobs within the travel field. There seems to be more jobs within the hotel field. Uh, but retailing is still one of our major places to place our young people.
PAUL SOLMAN: And what kind of money do those people get? These are high school graduates or high school equivalent?
MS. HAYES: These are high school children between the ages of fourteen when they get working papers and nineteen for our summer jobs, but for those who are out of school, it's the ages of sixteen to twenty-four that we serve.
PAUL SOLMAN: And what kind of money are they getting?
MS. HAYES: Well, those who are in high school, of course, are getting the minimum wage, which is at this time about $5.19 an hour, and those who are coming out of high school or in college get somewhere to $8.50 an hour.
PAUL SOLMAN: Now, Secretary of Labor Reich was worried about not enough summer jobs for inner city youth. He made a speech about this the other day. You're not as worried?
MS. HAYES: Well, we are kind of worried. We were worried previously because we didn't think there would be any summer youth employment money.
PAUL SOLMAN: At all?
MS. HAYES: At all. But we have found that there is some money and, uh, we have been able to stretch our, our job placement efforts, and we're not having any problem placing them. It's just that we have so many calling at our doors. We had over 900 kids so far that have been asking us for jobs.
PAUL SOLMAN: Well, I noticed that teen unemployment has gone down from sixteen seven (16.7 percent) to sixteen four (16.4 percent) in the last month. Black teens showed the same positive trend but that's from 31.3 percent down to 30.2 percent, so it's a big drop, but that's a huge number of unemployed black teens.
MS. HAYES: Yes, it is, and that's one of our biggest problems at Jobs for Youth because they have the attraction of the, the illegal market that is so, uh, attractive to them or can be attractive. So we have to lure them to the jobs that will build for the future.
PAUL SOLMAN: But you're, you're kind of hopeful today, as opposed to say a month ago?
MS. HAYES: Yes, we're very, very hopeful today.
PAUL SOLMAN: Okay. Audrey Freedman, who is getting the jobs and who isn't? Now that you've heard this, is this representative of the statistical picture of youth in America?
MS. FREEDMAN: Well, people who have no skills are having a very hard time finding a job, at least one that pays very well, but with strong job creation, they will find jobs in service industries that might be short-term, might be temporary, might even be part-time, but at least they'll be getting some experience and the kind of seasoning that makes them better applicants in the future. Of course, employers are always creaming, and, of course, they always want people--
PAUL SOLMAN: Creaming meaning--I'm sorry.
MS. FREEDMAN: Creaming meaning getting the best qualified that they can possibly get--
PAUL SOLMAN: Skimming the cream?
MS. FREEDMAN: --at the--yes, skimming the cream--at the salary that they can afford to pay. And so right now, uh, they will be trying to get highly skilled people and computer-wise people, at least computer-familiar people. And that makes a big difference. And that's why high school graduation and familiarity and ability to use a computer, even for service jobs, is important.
PAUL SOLMAN: Simone Taylor, do you agree with that? Is that what you're counseling people, liberal arts people, at the University of Michigan, except those that went into publishing, of course, who are going to take a low salary anyway?
MS. TAYLOR: Absolutely. Umm, I think the key to a strong liberal arts education is skill development, transferrable skills. I recently attended a conference where one of the vice presidents for Motorola spoke and really charged college people to teach students how to learn, that that was our business in higher education, and that if we could do that and provide them with the transferable skills that they need to enter the work force, that the work force would take the responsibility of teaching students how to actually do the job. Those skills, transferable skills, include the ability to analyze, quantitative skills, communication skills, good computer skills, as we've just heard, multi-cultural skills, the ability to lead in the diverse work force, and to be a good team member in a diverse work force, and I think also the ability to be community-minded so that students are prepared to not only contribute to the work force but also to the community at large.
PAUL SOLMAN: I'm sorry. Go ahead.
MS. TAYLOR: It really behooves and is the charge of higher education to prepare students with those skills, and I think that schools like the University of Michigan and others are doing that by building in multi-cultural programming, by teaching students how to work across groups of ethnicity, and, umm, also to be involved in community service. Those are important additional efforts that complement the classroom that really bring students prepared to function in the work world.
PAUL SOLMAN: David Pierce, do you agree with that? We kept hearing math skills, science skills, and, of course, computer skills in the last few years. Simone Taylor is emphasizing something a bit broader than that. How do you see it from the community college point of view?
MR. PIERCE: Well, in general, I agree with what's been said. Um, employers do want workers who can work with others and work in teams and communicate, can relate. They want--they want technical skills as well, but between the two, I think that they would prefer to have a person who can come and be there and be a good employee and then build on that, build their skill base on top of that.
PAUL SOLMAN: And Margaret Hayes, does that jibe with what you have experienced and what you're telling people in New York City?
MS. HAYES: It definitely does. We are not only teaching them computer skills. We have put computer training throughout all of our programs because we know it enhances their ability to be employed. But we're also teaching them leadership. We're teaching them the attributes of a leader and to recognize leadership, and we are putting leadership training throughout all of our programs. Whether they're high school dropouts or kids in high school, they need to understand that they are the future leaders of this country, and that's what we try to teach them at Jobs for Youth. We also change their attitudes toward the words world of work to appreciate work for itself and its value, so these, the things that were mentioned before and plus the things that I've just mentioned are what we do at Jobs for Youth.
PAUL SOLMAN: Thanks. Audrey Freeman--Freedman, how does al this jibe with the story we've been hearing about the hour glass economy, you know, more good jobs at the top, more good jobs at the bottom, and fewer and fewer jobs in-between? When you look at the data and you hear people talking now, is that thesis borne out by the recent numbers, or has that been overplayed?
MS. FREEDMAN: Well, I think it has been, and it's been stressed because it's sexy and makes headlines. Actually, what we've been worried about is that the ladders to success, the ladders upward, have been broken down and this is in large corporations and large bureaucracies of all kinds.
PAUL SOLMAN: Well, that's the idea.
MS. FREEDMAN: Yes, they are breaking down, and the career ladder and the career progression idea has been broken apart and fractured. This doesn't mean that work can't be rewarding and that work can't be, in fact, the best educational experience that people have. People don't really learn so much in school by being lectured at and by reading. They learn by doing, and they expand their horizons by doing a variety of things, so a career can involve moving from one thing to another, to another, to another, and learning as you go.
PAUL SOLMAN: Margaret Hayes, what do you think? Do you feel that there are fewer jobs in the middle now, and it's either feast or famine, you either get a good job at the top, or, or just a bad job at the bottom, or is that changing?
MS. HAYES: Well, I feel that there are fewer jobs in the middle that pay the kind of salaries that people with the kinds of backgrounds that are required to fill those jobs would like to have. It's not so much that the jobs aren't there. It's the rate of pay for those people in the Middle Class, but for those people at the lower service level, entry level, which is what we do, we seem to find that there are plenty of jobs mainly in the smaller manufacturing areas, the smaller business areas, and the smaller companies are hiring our young people, and also non-profit agencies, hospital, and places that use entry-level skills.
PAUL SOLMAN: Well, thank you very much. Thank you all for being with us.
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