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Research Finds Good Jobs Are Indeed Growing

By Kevin Wilcox

A Georgetown research team finds that the U.S. economy created a surprisingly high number of good jobs between 2010 and 2014, many in STEM fields.

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The report reveals that “good jobs,” defined as those that pay more than $53,000 and that generally offer health care and retirement benefits, have grown 44 percent.

October 13, 2015—Researchers at Georgetown University's Center on Education and the Workforce have found that during the protracted recovery from the Great Recession, the U.S. economy created more high-quality jobs than headlines over that period—which emphasized the addition of only lower-paying jobs—might have indicated.

"Those low-wage stories ran counter to what we know about cyclical patterns and long-term economic trends," says Tamara Jayasundera, Ph.D., a research professor at the center and one of the authors of the recent report "Good Jobs Are Back: College Graduates Are First In Line." The report defines "good jobs" as those that pay more than $53,000, which is 26 percent above the median for full-time workers in the United States.

Jayasundera notes that these good jobs tend to be the first added during an economic recovery as employers fill professional and managerial positions in advance of an expected expansion. Additionally, "over the long term, employers have been hiring more educated, highly skilled workers," she says. "And the college wage premium...has been growing since the 1980s. We truly wanted to figure out what is going on."

To examine the discrepancy between what was commonly reported about new low-wage jobs and the nature of the jobs that were actually added, the team used data from the Current Population Survey, a joint effort by the U.S. Census Bureau and the U.S. Bureau of Labor Statistics, which includes employment information about U.S. workers, compiled monthly. That data was complemented with a more detailed annual supplement collected by Census Bureau each March. The researchers found that the common misperceptions were often based on research that grouped jobs by the industries creating them rather than the actual types of jobs that were being created. For instance, the hospitality and leisure industry has a high percentage of low-paying jobs, and thus a lower average salary for the industry, and so more jobs in that category were often reported as more low-wage jobs. Yet that field also provides many high-paying jobs—for example, managerial and financial professionals.

When the team examined the data by grouping the jobs by occupation, they found that the jobs being created were actually those with higher wages and good benefits, such as those in the managerial, professional, and technical fields.

"When you look at occupation, [which] is categorized by the skills you need and the work you do on the job—[and] is very closely tied to the wages you earn—44 percent of job growth was happening among good jobs," Jayasundera says. "There is growth at every level—and low-wage jobs are also growing. However, low-paying jobs are not the overwhelming majority."

Of the 6.6 million jobs added during the recovery, 2.9 million were these good jobs, compared to 1.8 million low-wage jobs, and 1.9 million middle-wage jobs. The growth of good jobs accelerated from 2011 through 2012 and continued adding more jobs through 2014. The research found that 86 percent of the good jobs are full time, 68 percent offer health insurance, and 61 percent include retirement benefits.  

The research reinforces the value of a college education—2.8 million out of the 2.9 million good jobs were filled by college graduates. Fewer workers holding a high school diploma held good jobs by the end of 2014 than did in 2010. "Throughout, what we see is workers with a high school diploma or less are getting pushed out," Jayasundera says. "If you don't have anything beyond a high school education you're going to be struggling really hard to get into today's labor market."

Nearly all of the good jobs as defined in this report require at least some college education, Jayasundera says. "But even when you come to the low-wage jobs, you needed some post-secondary education," she points out. "Sixty-one percent of the low-wage jobs were taken by workers with some college education or an associate degree."

And the research reaffirms that a college education in science, technology, engineering, and math (STEM) continues to be a wise choice: STEM fields added 881,000 new good jobs between 2010 and 2014, second only to the 1.78 million added in the managerial and professional occupations. And other recent research indicates that students who earn a bachelor's degree in STEM fields earn more over their lifetimes than those who hold other bachelor's degrees. (Read " New Study Shows STEM Education Pays Off over A Lifetime" on Civil Engineering online.)

The center's research revealed that 445,000 good jobs were added in health care occupations, which rates second-highest after STEM fields, and 124,000 were added in sales and office support. But the blue-collar and education fields both lost good jobs over the same period.

"Job growth is being driven by the fastest-growing industries: consulting, business services, and healthcare," Jayasundera says. "Those are the industries that hire large numbers of managers and professional workers as well as STEM workers."

Jayasundera says that the overall sluggish recovery in the construction and manufacturing sectors is holding down the growth of middle-wage jobs, but both are beginning to show improvement.

She says that the center will undertake research to learn more about the college graduates who have filled these good jobs during the recovery and also to research wage stagnation during the recovery to determine how severe it is and why it is happening. "The stories that we hear is that wages have not been growing," Jayasundera says. "There is employment growth happening, but the wages have been stagnant.

"There are small signs of improvement, but it is not anywhere near what we want to see," she says. "I want to look into that wage growth a little bit more."

 

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