Category Archives: Business and Economy

Job outlook: either high-paying or low-paying, few in between

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Perhaps adding to the bleak economic outlook, some economists are suggesting that future jobs will fall into two categories: high-paying or low-paying with few jobs in the middle.

This would have implications for the size of different classes within the United States. To have a high-paying job, employees will generally need higher-education or specialized degrees. Having a service job means struggling to make ends meet. In this scenario, what kinds of industries or sectors might provide more middle-class jobs?

Male/female wage gap reversed for “unmarried, childless women under 30 who live in cities”

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The gap between male and female earnings has been a persistent feature in American society for decades. However, recent research suggests that a certain group of women are now outearning men:

[A]ccording to a new analysis of 2,000 communities by a market research company, in 147 out of 150 of the biggest cities in the U.S., the median full-time salaries of young women are 8% higher than those of the guys in their peer group. In two cities, Atlanta and Memphis, those women are making about 20% more. This squares with earlier research from Queens College, New York, that had suggested that this was happening in major metropolises.

Here’s the slightly deflating caveat: this reverse gender gap, as it’s known, applies only to unmarried, childless women under 30 who live in cities. The rest of working women — even those of the same age, but who are married or don’t live in a major metropolitan area — are still on the less scenic side of the wage divide.
The article discusses the main causal factors identified by authors: “a growing knowledge-based economy, the decline of a manufacturing base and an increasing minority population.”
At first glance, this may not be that surprising considering the number of women enrolling in and earning degrees at college. Additionally, the restructuring of the American economy away from manufacturing jobs and toward a service/knowledge economy has hit male dominated fields hard.
This bears watching.

Decrease in illegal immigration between 2007 and 2009

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Based on data from the US Census Bureau, a new report from the Pew Hispanic Center says illegal immigration has recently dropped with a 67% decrease for the years 2007 and 2009 (about 300,000 people a year) compared to the years 2000 to 2005 (about 850,000 people a year).

A Washington Post piece explores the reasons for the decline:

Douglas Massey, a Princeton University sociologist who studies migration, said the recession and lack of jobs are major factors in the decline of those entering the country illegally.

The unemployment rate for unauthorized immigrants is 10.4 percent higher than that of either U.S.-born residents or legal immigrants, the Pew report said.

Massey said other likely reasons for the decline include an increase in law enforcement and deportations, and enactment of stricter legislation against illegal immigrants. He also pointed to more guest-worker spots, from 104,000 in 2000 to 302,000 in 2009 — allowing more immigrants to come to the United States legally.

While these results are open to some interpretation (the article includes several perspectives), the economic situation has to play a big role. For all immigrants, a weaker American economy likely has a big impact on decisions about whether to come to the United States. Without plentiful jobs, the “land of opportunity” has less to offer.

One way to help assess the impact of economics on illegal immigration would be to see whether immigration of all kinds is down over this same time period.

Shopping malls and noise devices to discourage loitering

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A shopping mall in Washington D.C. has installed a noise device, the Mosquito, to discourage loitering:

The owners of the Gallery Place commercial strip have installed an anti-loitering noise device — one to discourage any loiterers, not just teens. Gallery Place has further urged the D.C. Council to pass an anti-loitering ordinance, something the city currently lacks.

Youths in particular are said to be sensitive to a greater range of high-pitch sounds. But Gallery Place Partners, LLC, insists they did not install the “state-of-the-art safety feature” to target teens alone. According to Gallery Place, the Mosquito installed in the Metro plaza is set to a tone that can be heard by people of all ages.

I recall reading that prior attempts to install such devices were accused of being targeted at teenagers because they can better hear and are therefore more annoyed with high-pitched noise-making devices. It sounds like this shopping center is pitching the device as a boon for all users – but are teenagers still the main target?

But this is also a reminder that shopping malls are not public spaces. Even though they are often function as such as place with crowds gathering just to hang out, they are privately owned and the owners are ultimately interested in making money.

Bonus: a link at the bottom of the news story to that takes you to the makers of the Mosquito where you can then find how annoying you find the Mosquito!

What to do with those extra years of life

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Virginia Postrel addresses how American society can move beyond seeing age 65 or retirement as the end of a career or life (“Floridization”):

It’s to change the pictures in our heads, to give up the images that “Floridization” evokes, as either a warning or an implicit ideal. People do not automatically become crotchety, backward-looking, and idle when they reach their 60s.

But changing that picture means exchanging today’s architectural metaphor, “building a career,” for another one: adaptive reuse. This is the human-capital equivalent of turning industrial lofts into apartments, factories into medical schools, power plants into art museums, or saw mills into shopping centers. Your original career may be economically obsolete, or you may just want a change, but your knowledge and experience still have their charms. Instead of equating success with a steady progression of better-paying jobs, each related to the previous one, this model emphasizes taking on new challenges and making new contributions, even if that means going back to school, taking a pay cut, or starting as a trainee when you’re middle-aged.

One version of this idea is the “encore career” advocated by Marc Freedman, who has made one of the most prominent attempts to think what how longer, healthier lives should mean for Americans’ careers.

This is an important topic to be discussing with longer life spans, limited funds for government retirement programs, and economic times that may require citizens to work to an older age. Those with more years have plenty to contribute to society and to simply write them off as past their time is foolish: it is not good for these individuals, their families and communities, and society.

Implicit in this discussion is an American emphasis on youth. Postrel cites one journalist who seems to suggest that youth equals progress and that being older automatically leads to loneliness. This may only appear to be the case because our society doesn’t leave much productive space for those who have retired. As I recently discussed, being older can lead to increased happiness and wisdom, two traits out society could use.

h/t Instapundit

Identifying four types of Evangelical leaders

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A new sociological study examines how Evangelical business leaders mix faith and business:

A new study based on interviews with hundreds of American leaders who are evangelical Christians (including CEOs, presidents, and chairs of large businesses and their equivalents in government and politics, nonprofits, arts, entertainment, the media, and sports) finds enormous variety in how leaders engage their personal faith in workplace decision-making.

“While everyone in the workplace has to make decisions—whether they’re the janitor or the manager—the most consequential decisions are made at the top, and we wanted to look at how they affect their businesses,” says D. Michael Lindsay, a sociologist at Rice University.

Lindsay found that most evangelical leaders fit into one of four decision-making categories: pragmatic, heroic, circumspect, and brazen.

Read about the four types in the rest of the article. The study suggests that Evangelicals live out their faith in a variety of ways. What predicts which type people fall into? And then how does acting as this type as a business leader affect their organization?

Of course, one could always ask if there is a more correct type…

Companies come, companies go: Blockbuster edition

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Blockbuster has been on the economic edge for a while now and is apparently close to filing for bankruptcy.

Perhaps Blockbuster is a microcosm of the economic situation in America over the last 25 years: it quickly grew in size to fill a market niche, expanded to what too turned out to be too many locations, and then eventually has reached a point where it needs to seriously regroup due to technological change and some other reasons. I remember seeing them sprout in the Chicago area. Within a few years, we went from no nearby stores to numerous locations within 5 miles (and even more of its type if we were to count businesses like Hollywood Video). They were everywhere, including suburban downtown locations and strip malls.

I would be interested in reading a sociological study about how this company expanded but then had trouble adapting to the changing market for movies and video games. How did they successfully find customers early on and then lose those customers later on? How did Blockbuster’s growth accompany general suburban growth, housing patterns, and growth of other important retailers?

A common tale regarding taxpayer funded stadiums

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Jeff Passan summarizes how the Florida Marlins misled the public about their profits in order to secure more taxpayer funding for a new baseball stadium to open in 2012.

There is a good amount of academic research that shows that large-scale sports stadiums rarely help the local economy in the way the owners suggest they will. Often, local taxpayers are stuck paying the bill while private owners profit.

Of course, do you want to be the mayor/public official that lets the beloved local team get away?

A home may no longer be a profitable investment

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The housing crisis in America has prompted a number of commentators to again examine what it means to own a home. A number of sources I have read recently have suggested there was a large shift regarding American homes toward the end of the 20th century: people saw homes less as places to live and have a good life and instead viewed a home as an important investment from which they could continuously generate profits.

A New York Times article makes this argument as well, saying “many real estate experts now believe that home ownership will never again yield rewards like those enjoyed in the second half of the 20th century, when houses not only provided shelter but also a plump nest egg.”

If this is true, it could have profound impacts on community life. Perhaps owners will stay in homes longer, spending more money on their current homes while also maintaining local social relationships for longer periods. Perhaps the housing sector of the economy (everything from manufacturers to developers to real estate agents) will decline in importance to other sectors.

h/t Instapundit

The real Trader Joe’s

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An interesting story at CNNMoney.com goes behind the scenes at Trader Joe’s. This trendy grocery store certainly has its fans; I had one friend in graduate school who seemed willing at times to drive 2 or 3 hours to shop at one.

Some of the details about the company:

Few customers realize the chain is owned by Germany’s ultra-private Albrecht family, the people behind the Aldi Nord supermarket empire. (A different branch of the family controls Aldi Süd, parent of the U.S. Aldi grocery chain.) Famous in Germany for not talking to the press, the Albrechts have passed their tightlipped ways on to their U.S. business: Trader Joe’s and its CEO, Dan Bane, declined repeated requests to speak to Fortune, and the company has never participated in a major story about its business operations.

Some of that may be because Trader Joe’s business tactics are often very much at odds with its image as the funky shop around the corner that sources its wares from local farms and food artisans. Sometimes it does, but big, well-known companies also make many of Trader Joe’s products. Those Trader Joe’s pita chips? Made by Stacy’s, a division of PepsiCo’s Frito-Lay. On the East Coast much of its yogurt is supplied by Danone’s Stonyfield Farm. And finicky foodies probably don’t like to think about how Trader Joe’s scale enables the chain to sell a pound of organic lemons for $2.

Companies are often made or broken based on their image and it sounds like Trader Joe’s want to keep a low corporate profile while building upon its popular name.

A question: would the store’s loyal customers not shop there any longer if they knew where the food really came from? Or knew more about what happened behind the scenes?