Does Decline of Middle Class Have an Upside? GlobalPost Takes a Look

BY Larisa Epatko  October 26, 2012 at 2:00 PM EDT


A GlobalPost video shows the pros and cons of jobs transferring overseas.

The struggling middle class in America is spotlighted in the current presidential campaign as never before in recent memory, prompting the international news organization GlobalPost to take an in-depth look at what the declining middle class means and what its impacts are overseas, both good and bad.

Executive producer of the series, “America the Gutted”, GlobalPost editor Thomas Mucha, said his team’s 10-month investigation brought several major points to light:

It’s Complicated

More U.S. jobs are moving overseas, such as in the garment and equipment-building industries, which means more jobs and a chance at a better lifestyle for people in other countries.

But in places such as the Philippines — one of the countries GlobalPost highlighted, where the middle class isn’t as developed as in the United States — the job growth isn’t a magic cure. “The working conditions are poor, they have low pay, and the social safety nets are weak,” Mucha said. “It’s an improvement, but they still have a long way to go.”

Changing Nature of Jobs

While some people who lose jobs go back to school or find other work, the types of jobs people used to be able to fill quickly like factory jobs have gone away because of improvements in productivity, he said. “With each recession, the time it takes for employment to come back takes longer,” said Mucha.

Other types of jobs, including those based on technology that allows employees to work anywhere, are helping boost commerce in some economically depressed U.S. cities. Another GlobalPost report shows how six major law firms have moved their operations from Washington, D.C., Boston and New York City to Dayton, Ohio; Nashville, Tenn.; and Wheeling, W.Va.

This “Amerisourcing” takes advantage of lower real estate costs and lower wages in the struggling cities, and they in turn benefit from the increase in jobs, Mucha said.

In India, the fast-growing legal process outsourcing industry means young people can move up the company ladder quicker than ever.

Emerging Green Energy Markets

Another oft-cited industry that is opening opportunities for people, even in the current economic climate, is green energy. It requires people to manufacture the equipment, such as solar panels, and more people to install them, so on a national scale, green technology is helping create jobs, Mucha noted.

Why Focus on the Middle Class?

While more people are falling out of the middle class these days, and are therefore getting much of the attention, what about people who have been in poverty all along?

The United States has a consumer-driven economy, and it’s the middle class that tends to spend the most — more so than the wealthy who usually save their money and the poor who can’t afford many products, said Mucha. “If the middle class is shrinking, that hurts the economy as a whole,” he explained.

“The point we were trying to emphasize in this series is how complicated the situation is — it’s producing good and bad effects. It’s a big messy global problem.”

View the full series online.

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