Demising the American Living Wage

Are you worried about your children and grandchildren’s future in terms of a better life?  You should be!  Market forces will make it harder for individuals to make an honest wage.  American companies, once loyal to their employees, have abandoned the social contract with their employees.  

Leaving today’s workers vulnerable to the consequences of globalization.  Thomas Friedman, author of The World is Flat, notes ‘The best companies outsource to win, not to shrink. They outsource to innovate faster and more cheaply in order to grow larger, gain market share, and hire more and different specialists—not to save money by firing more people.”  

Sadly, most companies do not have this long-term perspective about globalization.  In hindsight, globalization may produce a more equitable average wage across the world, while reducing the earning power of developed countries and increasing the living wages for emerging countries.  These realities on living wages are a critical concern for most Americans.  

Since the recession in 2008, U.S. businesses have posted historical profits even while unemployment has risen.  Consequently, the market place is saturated with seasoned individuals who are willing to take massive pay cuts in order to obtain a secure job.  Employers understand that it is a buyer’s market where employers can be picky. This reality has bottlenecked millions of young college grads who must fight for entry level jobs with career veterans.  

According to a Manpower Group analysis, 52% of U.S. employers state they have a difficult time filing positions because of talent shortage.   Peter Cappelli, author of Why Good People Can’t Get Jobs, outlines the hypocrisy of most employers:  “With an abundance of workers to choose from, employers are demanding more of job candidates than ever before.…To get a job, you have to have that job already. It’s a Catch-22 situation for workers—and it hurting companies and the economy.”  Employers are setting unrealistic hiring expectations and offering low wages.  

People, from every country, seek to earn a living to sustain themselves, by taking care of their basic needs.  According to the United Nations’ Millennium Development Report, more than1 billion people on the globe live on less than $1 a day.  

Ironically, as most Americans have watched their wages decrease, most other workers across the globe sees a significant increase.  The world’s middle income class earns between $700 to $7,500 per family member. Consequently, individuals making more than $7,500 are considered part of the global affluent class.   

Some experts argue that globalization has eroded America’s standard of living, especially during the resurgence of manufacturing.  Economist Gordon Hanson notes, “The U.S. has held manufacturing wages in check while there has been strong wage growth in China and moderate wage growth in Mexico.  

With high unemployment and fierce global competition, manufacturing companies has used this fact to their advantage.  This reality has forced two-tier contracts with unions to pay new hires less than existing workers and reduce new hires’ benefits.  In 2010 and 2011, new hires (manufacturing of durable goods) who had three years or more of experience, were paid an average of .3% less than workers in 2007 and 2008. 

Today’s American workers are finding it difficult to make ends meet. According to the Pew Charity study, economic mobility will be more difficult for individuals, especially depending on where they live.  Economic mobility relates to the ability of a person to move up or down the economy ladder.  

The Pew study concluded that people living in Louisiana, Oklahoma, South Carolina, Alabama, Florida, Mississippi, North Carolina, and Texas would be less likely to improve their economic standing.  However, states such as Maryland, New York, and Pennsylvania would have a better chance of economic mobility due to higher wages in manufacturing and public jobs.  

While the poorest American class wouldn’t consider itself part of an affluent class, this relative inequality of incomes is a bitter pill from citizens of poorer countries.  According to an UN study, the poorest countries across the globe consume 14% of the planet’s resources while 20% of the richest countries with the industrialized nations (including the United States) consume 86% of resources.  

Due to globalization, economic mobility will produce a variety of winners and losers.  Consequently, social mobility becomes more difficult as Americans are forced into a caste system of unemployed or underemployed workers. 

What will happen to economic mobility in America? Will the inequality of wages for global workers create new problems for businesses and society at large?                                                                                              

 © 2012 by Daryl D. Green                                    

 


 

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72 thoughts on “Demising the American Living Wage

  1. The current state of economic mobility can only remain stable according to some experts. In America’s case, being the leading economic power comes with its perks as well as its pressures. For instance it is well known that if America’s inequality in wages continues in this manner, not only are Americans affected by this but also the average employee who is already working in harsh, third world countries. According to Stiglitz, (2012) “America is paying a high price for continuing in the opposite direction. Inequality leads to lower growth and less efficiency. Lack of opportunity means that its most valuable asset—its people — is not being fully used” (para. 11) Unless the average American moves back into the work force and work whatever job needed, whether temporarily or permanently, the inequality in wages will continue to soar at higher levels. If effort is placed back into the workforce by the American employee willing to work for lower wages then in the future American businesses will thrive due to the persistence of its workers.
    Reference
    Stiglitz, J. (2012, June 10). What land of Oppurtunity? The American dream can be restored, but it will take some work. Retrieved from http://www.slate.com

      • At this rate while I think it is only fair to demand higher wages, I am thankful to have any wage considering the millions of Americans without a job or stable income. The reason many us remain so unhappy with what income we do have is the excessive living style we have grown accustomed to. While many were quick to judge the working conditions they exist in, the same people did not notice the causes of their own demise until it was a bit too late. According to Forbes, (2012) “If you’re already pretty satisfied with where you are salary-wise, know that there are many other things that factor into your happiness. Maybe your next negotiations should start focusing on other things” (para. 6) While I am not the richest person in America, it is safe to say I am quite satisfied with how my living conditions accommodate my needs. I am satisfied with the job I have because I am able to survive, however survival must be a practical form not exaggerated in anyway.
        Reference
        Learnvest. (2012, April 24). The salary that will make you happy (Hint: It’s less than $75,000) Retrieved from http://www.forbes.com

      • Dr. Green,
        More and more people are finding themselves without jobs which in return cause them to seek government help. This over bearing need for people to have the “right job” versus any job is now becoming a bigger issue. According to Guay, (2010) “In the food stamp program, which provides a varying level of aid, the number of cases has risen from 31,830 in June of 2008 to 52,566 in October, a 65-percent increase” (para. 9) At this rate according to the author families which rely on government help will more than likely pass this trait down to their children, which in return will continue on government aid. This affects the cycle of jobs if people do not just go out and attempt to work versus sitting at home. The need for wage increase is also determined by how many people are in the work force. If people do not partake in the workforce then there are minimal numbers to show what needs to be done.
        Reference
        Guay, V. (2010, November 21). Foster’s Daily Democrat. Families’ requests to aid programs rise sharply. Retrieved from http://www.fosters.com

    • Riyam,

      I like where you’re going with this and the emphasis you put on bringing back the demand for affordable labor. However, I don’t think lowering wages will revive the hosiery mills or small assembly plants once common in the U.S. We’ve already let those positions go and a vast majority will never be back. America’s role at the present time is innovation and it has been suggested that manufacturing related to innovation is most useful right now (Pisano & Shih, 2012, p. 3). So we actually need specialized manufacturing if we intend to support our innovator role in the Global economy.

      Furthermore, it’s ok to demand higher wages, but we better be building or providing something no other country is as competitive with and that lots of people want. Otherwise, that product or position is subject to outsourcing also.

      Pisano, G. P., & Shih, W. C. (2012). DOES AMERICA REALLY NEED MANUFACTURING?. Harvard Business Review, 90(3), 94-102.

      • Jamie & Riyam,

        Interesting comments!

        If going backward to the ‘Good Ole Days’ (lots of low skilled job available at good wages) is not an option, what will become of low skilled workers as well as the middle class?

        Professor Green

    • Riyam,

      I agree. I like what you wrote on Americans getting back in the workforce, “unless the average American moves back into the work force and work whatever job needed, whether temporarily or permanently, the inequality in wages will continue to soar at higher levels”. I think that says it all. If Americans are not willing to “do whatever it takes” than someone else will; and that will just compound the issue even more. I believe the jobs are out there we just need to be more willing to work.

    • July 14, 2012 WORDCOUNT 200
      I agree. Americans are the most valuable asset and we are not being utilized to our fullest potential. “For a long time, the United States was in denial about its growing income gulf. The middle class clung to the old promise of mass affluence — and used home equity loans and credit card debt to make that dream real.” (Freeland, 2011) American’s believe that an education is their ticket to a life of more money and fulfilled dreams so we went into debt investing in ourselves. These days it is difficult to hold onto those dreams.
      American’s still are spending money for college that we will be paying back for a long time, and the fear is that there will be no return on the investment. Everyone can’t be a rocket scientist there are not enough positions in the field. Many lower income jobs do not require a college education. What will become of everyone in between? I believe in America and our ability to be innovative and creative. Our leadership needs to breathe new life into America and blow some wind beneath our wings instead of hopelessness rhetoric.
      Freeland, C., Modern Capitalism isn’t working for the Middle Class, http://www.blogs.reuters.com, 2011

    • I enjoyed your post Riyam. It is undeniable that there is a growing income gap between the ultra-rich and the rest of America. According to report from the Congressional Budget Office, the share of income earned by the top 1 percent of households soared 278 percent between 1979 and 2007, while income growth for the bottom 20 percent of households was limited to just 18 percent during the same period. I also believe the lack of opportunity is extremely more pronounced for the lower class thus resulting in a growing income gap between the ultra-rich and everyone else.

  2. I do not see economic mobility improving for Americans in the near future. I think that education is a useful tool in restoring economic mobility, “While in theory that (education) could help poor children rise — good learners can become high earners (Deparle, 2012)”. However tuition hikes, stubborn congressional leaders, and future austerity to off-set government debt will put a burden on many of this nation’s young trying to get an education. It is my opinion that parents are going to have to sacrifice now in order to make a better future for the children of America, “That’s because the foundations of the dream — decent incomes, a good education and stable family structure (Ydstie, 2012)”. We, as parents, are going to have to shoulder some of the financial burden of our chinldren’s education in order for them to ascertain the means of economic mobility.

    References:

    Dwparle, J. (2012, January 4) Harder for Americans to Rise from Lower Rungs. The New York Times. Retreived from http://www.nytimes.com

    Ydstie, J. (2012, May 29) On the Economic Ladder, Rungs move Further Apart. Retreived from
    http://www.npr.org/2012/05/29/153918852/on-the-economic-ladder-rungs-move-further-apart

      • Dr. Green,

        I see your point. My New York Times source does touch on the fact that the pay scale in America is skewed towards educated workers. However, the point that I was attempting to make is that it is becoming increasingly more difficult for people in America to obtain an education because of rising costs, and the restructuring of government aid for students I think this will contribute to a further reducion to economic mobility in the future.

        Thanks,

        Ike

    • Education and debt are going to be some of the biggest hurdles to overcome through this globalization process. Education continues to become more and more expensive every year but more education is required by employers. “In the past 25 years, the average cost of tuition and fees has risen faster than personal income, consumer prices and even health insurance.” (Block, 2007, para 6) At the same time, America has continued to expand the amount of debt by amounts unseen in history. This increased cost of education and burden of debt on the next generation is something that we all will need to fix. Not address but fix in order to restore mobility. I believe all of these things can be overcome by a free market and the American spirit but we should not tie our hands behind our back along the way.

      References
      Block, S. (2007, January 12). Rising costs make climb to higher education steeper. USA Today. Retrieved January 12, 2012, from http://www.usatoday.com/money/perfi/college/2007-01-12-college-tuition-usat_x.htm

      • I believe we will see the cost of education shrink within the next five years because market forces will cause universities to develop different strategies to keep students in school. Basically, the federal government is subsidizing the education system because it is the only player in the education lending market. A shift in policy may be forced upon the government when the student loan default rate sky-rockets in the next couple of years. The American economy will remain attractive enough to lure foreign and domestic investment that will continue to provide employment opportunities for Americans. This is partially evident now, even during global economic downturn, as the U.S. treasury is able to sell 10 year treasuries for a pittance of an interest rate.

      • Or the opposite could happen. The higher demand will raise prices. Oversaturation of people entering the education industry which is the phase America is entering, lessons the value and the quality of education. Also, you have the negative effects caused by the overabundance time spent in school as opposed to the opportunity cost of spending that time at work. That reduces the amount of tax payers and GDP in the total system. According to Nation Master, the average time spent for adults is 12 years in school. Education is also a whopping 5.7% of total GDP. To compound matters, the average salary of faculty has only historically increased by 3.1% for 2005-2006, while inflation increased by 3.5% (AAUP, 2006). Of course, these were pre-recession numbers which means by now it’s only gotten worse.
        I would even like to offer the idea that what this nation is really lacking are more trade schools and less advanced education. Just a thought.

        AAUP. (2006). The devaluing of higher education. The Annual Report of the Economic Status of the Profession. Retrieved from:http://www.aaup.org/NR/rdonlyres/CF538568-A396-43F9-BD2E-AAFBEBED4ACD/0/06z.pdf

        Nation Master. (2003). Education in the united states. Retrieved from web: http://www.nationmaster.com/country/us-united-states/edu-education

    • I agree with your post Dwight. Some people are able to beat the odds and make history like Abraham Lincoln, who was born in a one-room cabin, or like Steve Jobs, who was adopted by middle-class parents. However, some would argue that just a small number of unusually capable and lucky people are actually able to live the American Dream, and that the publicity given to these aberrational cases is exaggerated in a deliberate strategy to keep the working class and the poor “in their place,” thus preventing them from agitating for a broader change (Siliva 2011). I believe not only parents will have to assume more of the financial burden of a college education but also that individual attending college.

  3. Yes, the inequality of wages will create new problems for businesses and society. In the past polices have focused on lower prices for the consumer resulting in the inequality of wages. Dewan (2008), states declining wages means a decrease in global purchasing power, a slow down of global consumption at a time when the world’s economic engine has already grinded to a halt (para. 7), therefore amplifying inequality of wages. As a result, American made products will find fewer buyers internationally leading to less jobs. This cycle causes undesirable social, economic, and political consequences for all. It can also lead to distrust among countries such as China with American companies.
    The falling wages can possibly be reversed by establishing a clear strategy that includes moving from the idea of lower prices to trade, aid, and economic efficiency. However, countries and their leaders must be willing to work together on common ground to achieve such progress, as well as, ensuring that the gains from economic integration are distributed more fairly for all. Such changes will improve bargaining power by the employee and reverse the inequality of wages.

    References:
    Dewan S. (November 26, 2008), Wage Inequality Is a Global Challenge, Centers for American Progress. Retrieved July 9, 2012 from http://www.americanprofress.org

      • Dr. Green,
        Companies could implement new pricing strategy globally by
         Look at efficiency – develop a relationship where older products that are in good condition can be sold to underdeveloped countries extending the product lifecycle

         Be the first producer in the market- develop their niche, what do they do well since this will attract less international competition

         Build and promote companies reputation for flexibility

         Develop internal innovations that lead to the goal of quality. Make a proposal to government to offer incentives to companies who have less defective products. Fewer defects leads to better pricing on materials; provide contracts with major companies in the US and abroad.

         Such as high school students participate in foreign exchange programs, offer exchange programs for companies to learn from one another (Toyota came to America to learn how we manufacture cars, they took the concept back and made it better.)

         Companies could offer a project graduate program- in this program a problem or issue is presented to college students in their junior year, students are asked to develop a solution for the company. The student that submits the best solution is offered a starting position with the company upon graduation.

  4. Indeed, economic mobility in the U.S. has shown the middle class to be falling further down the economy ladder. The shortage of jobs and unwillingness or inability of employers to pay higher wages has slowed advancement for current workers and made opportunities for individuals seeking employment very difficult. Because of these difficulties, I believe we will see a revival of the entrepreneurial spirit that America was first built upon. Tim Draper (2009) asks us take this into account, “GE, Microsoft, Shell Oil, AT&T, Merck, Johnson & Johnson, Sun Microsystems, Skype, Kodak, Polaroid, HP, and Adobe were all started during an economic downturn, some during the Great Depression” (p. 1). So, I’m actually very optimistic that economic mobility in the U.S. will improve in the near future.

    The inequality of wages will show us a migration of manufacturing jobs around the world. After China’s wages catch up to the U.S. and Europe, the jobs will move to another country with lower wages. That seems to be the trend to this point. U.S. workers have to adapt and be flexible.

    Draper, T. (2009). Economic and Business Dimensions Entrepreneurship During a Slump. Communications Of The ACM, 52(8), 24-26.

    • Jamie,

      I like the positive spin you’ve put on an unfortunate situation by presenting the idea that an entrepreneurial spirit may be reintroduced in America because of our current economic difficulties. I think this may have to be true for Americans if we are to pull ourselves out of this slump anytime in the near future. Our situation needs some sort of change and I think that an entrepreneurial spirit may be one of the only positive ways we can accomplish that. According to DeParle, (2012), “Americans enjoy less economic mobility than their peers in Canada and much of Western Europe.The mobility gap has been widely discussed in academic circles, but a sour season of mass unemployment and street protests has moved the discussion toward center stage.” (para. 2)

      I also agree with you that U.S. workers need to adapt and be more flexible in these difficult times in order to overcome hardships. I share your hopes that economic mobility in the U.S. will improve in the near future.

      DeParle, J. (2012, Jan. 4). Harder for Americans to Rise From Lower Rungs. Retrieved from http://www.nytimes.com/2012/01/05/us/harder-for-americans-to-rise-from-lower-rungs.html

      • Dr. Green,

        I hope it’s not the ONLY way to maintain American wages, but I do feel that our country was built on an entrepreneurial foundation. In a recent article I read, Ned Smith (2010) stated, “Americans are more likely than others to see themselves as risk takers. They are also more competitive or feel more confident they can tackle difficult tasks” He also discussed how Americans are more likely to take the risks involved in an entrepreneural culture than citizens of other countries. “More than 80 percent of the Americans surveyed said they are generally willing to take risks, compared with 65 percent of respondents in China and the European Union as a whole.” (Smith, 2010). I think Americans can use this to their advantage when overcoming harsh economic times, but I hope there are also other outlets that can help us maintain American wages in the future.

        Smith, N. (2010, Oct. 12). Entrepreneurial Spirit Reigns Supreme in America. Retrieved from http://www.livescience.com/8770-entrepreneurial-spirit-reigns-supreme-america.html

    • It’s so good to see someone with optimism. It is unfortunate that while some of us look forward to bettering ourselves and finding better jobs. While we have faith in ourselves other seem less optimistic. For example daily news only focuses on how awful the job market is and how much debt each person will experience for the rest of their life due to student loans. Hopefully we can all look forward to a better America with jobs trickling in once the cycle has made its course. According to Shiny Needle, (2012) “A recent report from the Bureau of Labor Statistics outlined a list of jobs and growth fields through 2018 and beyond” (para. 2) It is only a matter of time before things better, can we survive six years until 2018? Hopefully for the sake of the better we do, instead of dreading what will hopefully turn around and change for the better.
      Reference
      Shiny Needle. (2012) Top jobs for the near and distant future. Retrieved from http://www.shinyneedle.com

      • Good point, Riyam. Now that the Supreme Court has passed the health care law, we are going to see hiring needs in the healthcare industry rise, considerably. “With 30 million people expected to gain health care coverage under the health care law, industry experts say demand will only increase for qualified employees across a variety of medical disciplines.” (Driscoll, 2012) According to the article, the Affordable Care Act focuses on primary care and managing chronic medical conditions so this means healthcare professionals who are an extension of the doctor will be in great need, examples include registered nurses, physicians’ assistants, nurse practitioners, and care managers.

        This should bring great news to those LMU students in the nursing program. We are certainly going to need them.

        Reference:

        Driscoll, S. (2012, July 16). Hiring boon predicted after health care law ruling by supreme court. Rockford Register Star. Retrieved on July 17, 2012 from http://www.rrstar.com/news/x736423369/Hiring-boon-predicted-after-Supreme-Court-health-care-law-ruling

      • Just like you said, “You’ve got to hustle.” We don’t all have to be entrepreneurs to enjoy a good income. However, if we’re talking about building wealth, there are only three things that can put people on the fast track. First, sell something. Good salesmen, on average and depending on what they are selling, make as much or more money than doctors or lawyers. Second, become a professional such as a doctor or lawyer. Third, own your own business. The rest of the wealthy people have either had the money given to them or it may even be stolen.

    • Jamie, your presentation of the American entrepreneur was a very optimistic approach to read. Indeed, individuals with thoughts as you define the American resilience. Indiviglio (2011) claimed that recent declines “will keep hiring weak and unemployment high” (para. 5). It is in these moments so many attempt to reinvent themselves. There are some important facts to support how important entrepreneurs and small businesses are. The U.S. Small Business Administration (n.d.) has stated small business “are 52 percent home-based, produce 13 times more patents per employee than large patenting firms, and create more than half of the nonfarm GDP, and generated 65 percent of net new jobs” (para. 1). As you noted these small businesses which must have began with an entrepreneur’s innovation has become a vital aspect to the local economies but also the nation as whole.
      Reference
      U.S. Small Business Admisitration. (n.d.). Advocacy small business statistics and research. Retrieved July 11, 2012 from http://web.sba.gov/faqs
      Indiviglio, D. (2011). Chart of the day: Americans’ Declining purchasing power. Retrieved July 10, 2012 from http://theatlantic.com/archive/2011/07/chart-of-the-day

  5. “The Pew study concluded that people living in Louisiana, Oklahoma, South Carolina, Alabama, Florida, Mississippi, North Carolina, and Texas would be less likely to improve their economic standing. However, states such as Maryland, New York, and Pennsylvania would have a better chance of economic mobility due to higher wages in manufacturing and public jobs. “

    This line, throughout the entire blog entry, jumped out at me more than any other. Why? Right to Work. ALL eight of the States listed as have citizen people living there being less likely to improve their economic standing as opposed to Maryland, New York, and Pennsylvania, which are considered “Forced –Union States” according to the National Right to Work Legal Defense Foundation. Is this because unions for employers to a better wage than non-union workers, and the corporations take advantage of workers in areas where they do not have a need to balance commitment to the worker with union contract obligations?

    But how does this balance with the evidence that Forced –Union States are facing economic bankruptcy due to union financial obligations? Many Right to Work advocates sight reports regarding Forced Union where tax paying residents are fleeing the States for other State with lower or no state income tax, and perhaps more telling, are seeing decline in school-age populations while Right to Work states are seeing an increase.
    What does this say about the middle class? Will there be a balancing of salaries towards higher wages as the economy (hopefully) picks back up? Are lower wages the new norm? And despite economic mobility being better in forced labor states due to higher wages in manufacturing and public jobs, WILL this continue to be the case as many states, like Wisconsin, begin to push back again the cost of doing business with unions, and also begin to scale back public jobs as the price of maintaining them becomes too much.

    References

    NILRR Staff (2012), “School-Age Population Falling In Forced-Unionism States”, http://nilrr.org/2012/05/16/school-age-population-falling-in-forced-unionism-states/

    NRTW Committee Staff (2012), “Taxpayers Fleeing Forced-Unionism States”, http://www.nrtwc.org/taxpayers-fleeing-forced-unionism-states/

    • Dell,

      Excellent!

      Unions made significant contributions as we witness workers in factories during the industrial revolution.

      However, many people say the union model does work in the 21st Century. Why or why not?

      Note: Passion is cool! But—you got to back up your opinions….with Facts!!!!

      Professor Green

  6. This is an issue that resembles a slow moving cancer for the middle class. From week to week an individual may not recognize this shift but over the course of a decade this will leave many asking what happened. Indiviglio (2011) stated, “Though wages had generally increased since last fall, inflation has risen faster”. The average inflation rate for 2011 was 3.2 percent (“Current Inflation”, 2012). The U.S. Bureau of Labor Statistics (2012) reported, “Compensation rose 1.9 percent, wages and salaries 1.7 percent, and benefits 2.7 percent. To compound this issue many companies are mimicking gas prices, quick to rise and slow to fall. Businesses quickly implemented cost cutting measures in 2009. However, as noted from the subject blog text many of these companies are now recording record level profits but are not passing this down through all the external stake holders. If both of these trends continue it will ultimately alter the many Americans purchasing power.
    Reference
    Current inflation rates. (2012). In U.S. Inflation Calculators online website. Retrieved July 10, 2012 from http://usinflationcalculator.com/inflation/current-inflation-rates
    Indiviglio, D. (2011). Chart of the day: Americans’ Declining purchasing power. Retrieved July 10, 2012 from http://theatlantic.com/archive/2011/07/chart-of-the-day
    U.S. Bureau of Labor Statistics. (2012). Employment Cost Trends. Retrieved July 10, 2012 from http://bls.gov/ncs/etc/

    • Kevin,
      Outstanding commentary!

      If your analogy is right about the decaying middle class (symbolized by cancer), is there a cure for the American middle class?

      Professor Green

      • Dr. Green,

        I really enjoyed reading James’s post about entrepreneurship. An answer definitely rests with Americans attempting their great ideas in the market place. Obviously, if they are unemployed they have nothing else to lose. I believe the real solution rests in American innovation curve. There is a coined term for this but basically through the twentieth century every twenty to thirty years the next great innovative life changer emerges. Examples could include the automobile, then television, and computer systems. With each product emerging enormous new markets were created. Currently, we are waiting for this innovative idea to emerge. Today, I believe this rests in renewable energy. The issue is will America allow this to be outsourced as well because countries such China are using many government subsidies to gain a competitive advantage.

    • Kevin, I agree with you completely on how this is like a slow moving cancer. This is true with taxes, school tuition, employment and many other things. If we some these hung changes happen overnight, I believe there would be a revolt by the people. But since we are very slowly pulling the band-aid off, it does not seem to hurt as much. It is imperative for people to understand the issues and know what is really going on and what might happen because of it. Taxes do and will continue to play a huge role in the spending ability of many Americans. “Americans will work 107 days into the year, from January 1 to April 17, to earn enough money to pay this year’s combined 29.2% federal, state, and local tax bill.” (para. 3) Issues like this must be dealt with in order to free up Americans to buy, spend and create business.

      References
      Tax Freedom Day. (2012). Tax Freedom Day. Retrieved July 13, 2012, from http://taxfoundation.org/tax-topics/tax-freedom-day

      • I concur with your analogy about slowly pulling the band-aid off so that it does not hurt as much. This year, the saving rate dropped to 3.7%, which is the lowest level since August 2009. It had averaged 4.7% for all of last year (USA Today, 2012). Also I look at how the inflation in gas go up in increments, I find myself spending an additional $10 in gas per week which could be in savings. Also in recent times my healthcare package has risen 21%, once looking at a small amount it does not seem like a big deal, but over time when you realized over a 3 month span you could have saved an additional $200-$300. Last but not least, the correlation of slight increments do not align with increase in pay rate, especially in the healthcare increase because at least in my situation, I am not using my healthcare frequently.

        “Feb. Consumer Spending Up, Income Lags.” USA Today. Gannett, 30 Mar. 2012. Web. 30 July 2012. .

  7. Economic mobility is lower today than it was for previous generations in the American middle class. I believe this is due to the manner in which they have become accustomed to living and the recent economic events, even on a global scale. Prior to 2008 I believe that lifestyles were such that more money was spent than saved with the expectation that jobs would be plentiful. Mobility for lower skilled workers in the lower income brackets is most difficult and I believe that they will continue to have a difficult time. Globalization has increased the labor supply of lower skilled workers and served to depress wages and opportunities for them since they have had to compete with an increase in low wage laborers in emerging-market economies.

    I anticipate issues for businesses and society as a whole globally until economic conditions improve and wage rates level out. Businesses will either have to raise wages in emerging-market economies or American society will need to accept lower wage rates to narrow the gap.

    Reference:

    Siliva, J., & E. T. (2011, November 17). Economic Mobility: Is “Rags to Riches” Still Possible? Retrieved July 9, 2012, from The Big Picture:

    • You’re right Gail. We’ve been living and raising our children with a “gimme” attitude for quite a while now. We have expected opportunity to fall in our laps. Now that we realize that other people and countries are acquiring and accomplishing the same things we are, it’s time to be competitive again. Nitin Nohria (2012) recently stated, “U.S. prosperity and social mobility have attracted millions of immigrants, including me. But America’s reign as the global ideal seems to be waning” (p. 2). Nohria goes on further to recommend that the change start at the government level (Nohria, 2012, p. 3). He seems to believe (as do I) that if businesses have faith in their government, long-term success is easily achievable.

      Nohria, N. (2012). Why U.S. Competitiveness Matters to All of Us. Harvard Business Review, 90(3), 49-51.

    • My thoughts exactly on the economic mobility when it comes to fair wages. The rate in which the average American spends is ridiculous compared to the lack of income most households have had to endure over the past few years. Sacrifice is necessary for long term comfort. According to DeParle, (2012) “mobility from the very bottom up is ‘where the United States lags behind’” (para. 3)Other countries are able to do without everything they really desire. The idea that everything is affordable and not luxury has disillusioned many people in living way above their means. People need to realize if cash is not available at the time of purchase then an item should be considered a luxury.
      Reference
      DeParle, J. (2012, January 4) The New York Times. Harder for Americans to rise from lower rungs. Retrieved from http://www.nytimes.com

    • I am going to tag along on this conversation. The middle class is having a harder time keeping up, but they also have to ability to help themselves. I have always believed that the American consumer has a hard time distinguishing between a want and a need. Do we want the new iPad or iPhone? Yes. Do we need the new iPad or iPhone? Matter of willpower. Personally, I have never owned an iPad or iPhone. I’ve personally never been on the for front of technonlogical advances because I don’t need it to function. People have forgotten how to save up for that “rainy day.”

      Amy Novotney of the American Psychological Association states “since 1982, Americans’ personal savings rate has dropped from 11 percent to below zero.” (Novotney, 2008) I didn’t think a negative savings rate was possible. Our society has been conditoned to spend. It almost seems like its the american way to be in debt. Is it possible that wages paid could be fine if people were not so conditioned to spend and re-learned the art of saving? As Riyam noted above, if you can not pay for it, your probably don’t need it. There is that need word again.

      Novotney, A. (2008). What’s behind american consumerism?. American Psychological Association, Retrieved from http://www.apa.org/monitor/2008/07-08/consumerism.aspx

      • Adam, you are right. There is so much instant gratification today that people don’t know the difference. That was not the case when I was growing up and certainly not the case for my parents, particularly my father, who started out with very little.

        I think that those in the lower income brackets are going to have it more difficult time due to the lack of access to a good education. The limited access is due to lack of money and the lack of good primary and secondary schools in their area This obviously limits their qualification for the better jobs.

  8. If the U.S. government does not take more immediate actions to address the inequality between earnings in America, the gap will only continue to widen. The study, entitled “Global Wage Report 2008/09,” reported that since 1995, inequality between the highest and lowest wages has increased in more than two-thirds of the countries for which data is available. The United States is one of the advanced countries where the inequality level is higher. The decline in wages and rising inequalities across the globe, combined with the current economic crisis, present some difficult problems. Social or political tensions, particularly for those countries that have a weak democratic or undemocratic government are a concern. Another consideration is the impact it has on our relationship with other countries to handle such topics as global warming and terrorism.

    The inequality of wages for workers globally is not only an ethical issue, but also has a direct impact on sustainable security, economic stability and prosperity for the U.S. and the world. If there are fewer buyers of America’s exports, and we purchase fewer imports, the slowdown in global consumption impacts the world’s economy.

    References
    International Labor Office, Geneva (2010. Global Wage Report 2010-11, Wage policies in times of crisis. Retrieved July 12, 2012 from http://www.ilo.org.

    Luhby, T. (November 8, 2011), CNNMoney, Global income inequality: Where the U.S. Ranks. Retrieved July 12, 2912 from http://money.cnn.com.

      • Dr. Green,

        This is apparently a very hot topic at this time’ From recent articles that I have read, many economists believe that the minimum wage of pay should be increased to narrow the increasingly widened divide in America, Numerous economists share the belief that the answer is to educate the less fortunate in our country, but the question remains as to where funding will come from because our country’s federal deficit is already about $1.3 billion for 2012 and will continue to climb.

        From a global perspective, a clear, strategic focus on trade, aid and monetary policies towards a stronger form of economic governance with efficient and effective labor, consumer, investor and social protections can help to make certain the improvements from economic integration are dispersed more fairly. If the U.S. generates more demand abroad for our products and services, it will improve living standards here and abroad. The importance of addressing rising inequality, whose key component is wage inequality, is necessary, ethically, economically and politically toward achieving sustainable security and prosperity for the U.S. and the rest of the globe.

        Reference
        Dewan, S. (November 26, 2008). Wage inequality is a growing challenge. Retrieved July 5, 2012 from http://www.americanprogress.org

  9. Jobs are being outsourced and wages are being impacted here in the United States where we are seeing higher unemployment, lower wages for some and higher employment standards set by businesses. Having said all of this, I am very hopeful for the future in America because we have found ourselves in negative situations in the past and have overcome. Economic mobility will depend on the will of the American people. I am very hopeful for the future in America because we have found ourselves in negative situations in the past and have overcome. This is due to freedom, creativity, ingenuity and self motivation. We simply have to understand the new market and what opportunities it presents. This is where the creativity and ingenuity comes in. With all situations there are opportunities. “After all, the right time to start a business is when you have a great idea where your product or service benefits customers, recession or not.” (Isidro, 2009, para. 4) It will simply take someone to see and capitalize on those opportunities.

    References
    Isidro, I. (2009, June 2). 15 Home Business Ideas That Thrive During a Recession. Power Home Biz. Retrieved July 11, 2012, from http://www.powerhomebiz.com/News/062009/home-business-ideas-recession.htm

  10. Globalization has and will continue to change the world. It has helped to bring better jobs and better living conditions to many countries like India and China. All of these changes have created problems and opportunities for business. Obviously the opportunities for many businesses lie in areas where standards of living have continue to increase. With this increased business in certain areas like India come increased job opportunities and improved wages. On the opposite side we have seen decreased job opportunities and poorer wages in the United States. While globalization has moved many unskilled labor positions to developing markets, Hill believes that “this is a temporary phenomenon representing a structural adjustment on the way to a more tightly integrated global economy.” (Hill, 2011, p. 29) American businesses are faced with the challenge of not alienating their local customers and finding a way to overcome the decrease in available funds locally and taking advantage, if possible, of growth opportunities around the globe.

    Reference
    Hill, C. W. (2011). International Business: Competing in the global marketplace. University of Washington: McGraw-Hill/Irwin

  11. Hill makes an important point in his book about globalization and economic progress. ” They argue that tougher environmental regulations and stricter labor standards go hand in hand with economic progress” (Hill, 2011, p.29). If America does not realize that lowering wages and raising the prices of everything needed such as food, transportation, and everything else to survive the eonomy is just going to crumble. With all the unemployment among America people are racking up debt with credit cards and losing their houses because of unemployment and hiring cuts and wage cuts. Something has got to change and the prices have got to level out rather than continue to rise.
    Reference
    Hill, C. W. (2011). International Business: Competing in the global marketplace. University of Washington: McGraw-Hill/Irwin

  12. I agree. Economic mobility is harder to achieve in today’s times – more so than it was before the recession, but I do not believe it is impossible. We are still considered the land of opportunity. For instance, my dentist is from India and at my last visit, we were talking about the “American Dream”. He said if you cannot make it here (America) you cannot make it anywhere. How can someone move here from another country, speak mediocre English, and be successful? Especially, when the people who were born here are given opportunity, an education, and the freedom to choose what he or she wants to do. I believe it is because some Americans are just lazy and expect a handout. Yes, we might outsource jobs to India and other countries, but natives in those countries still come here to “Live the American Dream”; the very same reason our ancestors came here long ago – too bad many of us have forgot that dream.
    Recently, ABC did a report on “Are Americans Losing High-Skilled Jobs to Foreigners”, and in the report were some shocking numbers. Huma Khan, the reporter writes, “Sixty-five thousand H1B visas are given to companies every year, and 20,000 are given to foreign workers with a U.S. master’s degree or higher” (2012). Therefore, it is not that economic mobility is becoming harder to achieve, it is because Americans do not have the enthusiasm to succeed as the 20,000 foreigners do. The visa carriers know they have to work hard here and stay because they DO NOT want to go back home – that’s their incentive!

    References
    Khan, H. (2012, February). Are Americans Losing High-Skilled Jobs to Foreigners. Retrieved from abcnews.go.com: http://abcnews.go.com/blogs/politics/2012/02/are-americans-losing-high-skilled-jobs-to-foreigners/

    • I have heard the same sentiment from many of my India-born customers. They have worked hard to learn the language, gain education and take advantage of the vast opportunities available in America. And each one can intelligently discuss local and national political views and have accepted this country as their own. The children in school today may not know yet how many tools are available at their disposal. Maybe the parents or teachers aren’t sure yet how to utilize these tools. Instead of Angry Birds, have the kids mix in some science or math building games. The opportunity is available to achieve economic mobility.

  13. The inequality of wages can create problems for businesses and societies. Equal opportunity may be harder to attain in an unequal society (Acemoglu, 2011). Research has indicated that American children born since the 1950s have had lower educational mobility than children in Sweden and other Western nations have. In addition, the link between parental income and educational advantages on one-hand and child academic outcomes on the other is stronger in the United States than in other Western countries (Winship, 2011). If the wage differences keep a person in the lower class from getting a good education then businesses will not have as large as talent pool to fill jobs. If a quality education cannot be obtained a person in the lower class will not have a chance to improve their economic status. Opportunity and education are key in economic mobility, without these there would be no economic mobility.
    Resources
    Acemoglu, D., (2011, 01, 23) Economic power begets political power. The Economist. Retrieved from: http://www.economist.com/economics/by-invitation/questions/how_does_
    inequality_matter

    Winship, S., (2011, 11, 09) Mobility Impaired Scott. National Review Online. Retrieved from: http://www.nationalreview.com/articles/282292/mobility-impaired-scott-winship?pg=2

  14. We are experiencing the impact of the decline in American manufacturing on U.S. wages. According to a report by the Information Technology and Innovation Foundation, years 2000-2010 comprised the worst period in history for U.S. manufacturing, during which 5.7 million jobs were lost (Atkinson, Stewart, Andes & Ezell, 2012). While most economists might point to increased productivity and outsourcing as the main reasons for the decline, the core reason behind the job loss was the U.S. losing its edge in manufacturing competitiveness.

    Additionally, the perceived rebound in manufacturing jobs of 8.2 %, or 166,000 is not as impressive when one considers the total job loss during the recession was approximately 2,000,000 (Atkinson, Stewart, Andes & Ezell, 2012). According to Atkinson, et al. at this rate of growth it will take until the year 2020 in terms of manufacturing jobs to return to the pre-recession period of 2007.

    For wages to increase, the U.S. must return to a skill based manufacturing economy, which means a rethinking of U.S strategy in this area.

    Atkinson, R., Stewart, L., Andes, S., & Ezell, S. (2012, March 19). Worse than the great depression: What the experts are missing about American manufacturing decline. Retrieved from http://www.itif.org/publications/worse-great-depression-what-experts-are-missing-about-american-manufacturing-decline

  15. Economic mobility is not dead, we still live in the “Land of Opportunity.”
    High unemployment has slowed mobility following the recession. This leaves Americans with the sense that opportunity is lacking. Preventing American companies from outsourcing/ restricted trade policies can’t protect us from global wealth redistribution. With prosperity comes a sense of entitlement. However, hardships can lead to re-evaluation of priorities, practices, policies, etc.
    That is the pivotal point we find ourselves. Access to education and training are key. Weekly earnings for individuals with bachelor’s degrees are 64% higher on average, and they are less likely to experience unemployment. (Bradford, 2012) Research and development, innovation, and changes in tax policies could be instrumental to positive change. Skills also have to remain honed. And, effective management strategy is crucial for a healthy economy.
    Current limitations exist, but so do freedom and opportunity. “Let every nation know, whether it wishes us well or ill, that we shall pay any price, bear any burden, meet any hardship, support any friend, oppose any foe, in order to assure the survival and the success of liberty.” – J.F. Kennedy

    Bradford,H. (2012) College Degree Makes Upward Economic Mobility Much More Likely For America’s Poor: Retrieved from http://www.huffingtonpost.com/2012/06/23/college-degree-makes-upwa_n_1619760.html

    • Kathy,
      I think that you make a great point about “Access to education and training are key. Weekly earnings for individuals with bachelor’s degrees are 64% higher on average, and they are less likely to experience unemployment.” (Bradford, 2012). According to Michael Porter; “Not only is a good education system a determinant of national competitive advantage, but it also an important factor guiding the location choices of international business.” (Hill, 2010, p.121). The recent trends to outsourcing information technology jobs to India are a result of the significant numbers of engineers in India. This is because of the Indian education system. “The general education level of a country is also a good index of the kinds of products that might sell in a country.” (Hill, 2010, p.121).

      Bradford,H. (2012) College Degree Makes Upward Economic Mobility Much More Likely For America’s Poor: Retrieved from http://www.huffingtonpost.com/2012/06/23/college-degree-makes-upwa_n_1619760.html
      Hill, C. W. (2011). International Business: Competing in the global marketplace (9th ed.). New York, NY: McGraw-Hill/Irwin.

  16. July 14, 2012 WORDCOUNT 197

    Economic mobility in America will remain stagnate; Technology wiped out entire sectors of the market, demand for jobs is high in America so employers can offer lower wages, middle income jobs moving overseas causing inequality in the job market (specialized jobs are abundant jobs at the bottom are abundant), going to college is out of reach for many individuals as not everyone can be a doctor or scientist, the idea that a corporation can do whatever they please, leaving a wake of devastation …As a result, inequality of wages is a serious problem for businesses and society at large. Not all organizations will outsource or become multinationals and so where will the others find their competent midlevel workforce?

    “A stagnant economy that no longer favors mobility and social tensions due to growing income inequalities. All this was brought about by a variety of factors, including technology, the bad side of globalization and the exponential growth of the financial sector as a driving component of the American economy.” (Schirach, 2012)
    Von Schirach, P., The End of US Upwrd Mobility, Economic Stagnation, Economic Inquality are shaping a nasty political Battle – Who will rebuild America? http://www.schirachreport.com, January 5, 2012

    • I agree the wage market is stagnant. However, thanks to globalization 3.0 technology such as mobile PC’s, affordable and accessible software, and outsourcing (Friedman, 2007). I foresee individuals rising up and grasping their fair share in the market place. We can obviously see that institutions are failing because they no longer have the solutions to the crisis. It is the individuals who possess the talents, gifts and abilities to create solutions in every crisis. Yes, inequality is temporarily here. But, the playing field is flattening and the spirit of entrepreneurship exists; therefore, we will begin to see some leveling and not just nationally but globally (Friedman, 2007).

      Friedman, T. L. (2007). The world is flat: A brief history of the twenty-first century. New York: Farrar, Straus and Giroux.

  17. For some companies globalization could create problems for their employees not necessarily the company as a whole. A company does not have to be the size of multinational giants to facilitate and benefit from, the global markets. 90 percent of firms that export are small business employing less than 100 people, and their share of the total U.S. exports has grown steadily over the past decade. Firms with less than 500 employers accounted for 97 percent of all U.S. exporters and almost of 30 percent of all exports by value. (Hill, 2010, p.6).
    When you look at the societal impacts of globalization, you could argue that some in society was negatively impacted; the fact is change is the only constant in life. We must constantly reinvent ourselves to face the challenges of the future. Society hates the lost jobs but loves the low prices from global competition.
    Hill, C. W. (2011). International Business: Competing in the global marketplace (9th ed.). New York, NY: McGraw-Hill/Irwin.

  18. Economic mobility today is difficult in America since the years of recession coupled with the political decision to prolong the age of retirement. Skilled veteran workers are working beyond the age of 55 and even 60. Most are working because they cannot afford to retire and live at their desired standard of living. While others are simply working longer because of the fact that people are living longer and because of technological advances in medicine they are healthier. Therefore, the older skilled workers are occupying jobs which generally pay more and usually they are the jobs that are higher up on the economic ladder. So, when you are the boss, supervisor, person in charge and making good money why retire? What incentives are in place to entice the economically higher up the pay scale worker to retire? And, the answer to that is there are none.
    What this means is those inexperience college graduates now must compete with the skilled veterans (those who may have lost their jobs due to down-sizing, outsourcing, etc.). And, because of globalization 3.0 as Friedman describes in his book The World is Flat they must also compete with qualified, skilled and unskilled applicants across the globe. They must be competitive in the global market place with skills, experience and salary. So, American students and graduates must wake up and plan to seek experience abroad if the job market does not look so promising for them here in the USA.
    According to Hill in his International Business book developing countries are no longer dragging behind in obtaining their share of the market. Globalization and the three convergence events have equalized the playing field for developing countries so as they increase in market share the USA has experienced some gradual declines. But, the USA is resilient we find a way to bounce back.

    Friedman, T. L. (2007). The world is flat: A brief history of the twenty-first century. New York: Farrar, Straus and Giroux.

    Hill, C. W. (2011). International Business: Competing in the global marketplace (9th ed.). New York, NY: McGraw-Hill/Irwin.

  19. America is well positioned to compete in a global economy because the US dollar remains the world’s reserve currency, American workers are given the opportunity to continually advance their education and the business environment in America remains committed to capitalism. Economic mobility is part of the American dream and remains alive today. As long as the U.S. government remains committed to enacting laws that encourage business growth and entrepreneurism, Americans will have the opportunity to gain economic mobility.

    American businesses have received an education on outsourcing jobs and we are seeing some of those slowly come back stateside. As wages grow in countries like China, businesses will look for the next low wage country that saves the company money on the bottom line. Creating development in low-wage countries will not create new problems. It helps spread money, ideas and ingenuity to regions that have not experienced any of it before. Companies remain committed to profits and the realization of global competition may have skewed the social contract that many citizens in the U.S have benefitted from for so long.

    • I like your thoughts on this topic Paul. I had never thought about spreading the money around the world. This is a very interesting way of thinking about this issue. I also never considered how economies around the world are also growing and their living expenses are also on the rise. So many people talk about outsourcing as a “ultimate.” Your comment made me consider an alternative. Eventually do you think that the jobs will be relocated back to the US because companies will run out of “low-wage counties?” Obviously this is a long time away but I think it may be something to consider.

  20. What will happen to the economic mobility in America? As I sit and ponder on this question, one memory comes to mind. A memory of my great-grandmother recounting her moments after The Great Depression and uttering her advice to future generations. She speaks of a time when people had passion, work ethic, and the desire to innovate and prosper. The American people need to be willing to take any job to be self reliant. They need the inclination to leave the familiarity of their homes and move to areas where opportunity is available.  Jobs have been under attack with offshoring and outsourcing, but it’s very valid to argue that immigrants and others have demonstrated that they have stronger work ethic. 

    Kiernan (2012) states “since 1994 we have lost 6 million manufacturing jobs and China has gained 10 million. And most of those lost jobs won’t ever be coming back. Manufacturing isn’t dead in this country, just different.” This being said, the shape of our economy and the future of American businesses is dependent on the American people. The American spirit needs to be rejuvenated with willingness and desire to give an honest day’s work for an honest day’s pay.

    Kiernan. (2012, March 06). How to get americans back to work . Retrieved from http://www.forbes.com/sites/danschawbel/2012/03/06/how-to-get-americans-back-to-work/

  21. The economic mobility in America is uncertain. Research suggests that Americans enjoy less economic mobility than their peers in Canada and much of Western Europe. “It’s becoming conventional wisdom that the U.S. does not have as much mobility as most other advanced countries,” said Isabel V. Sawhill, an economist at the Brookings Institution. Tax policy has played a role in rising inequality. Although our tax code is still progressive, tax changes in the early 2000s benefited the very wealthy by much more than other taxpayers, compounding the widening gap in pre-tax earnings. I believe with the worsening of the economy it will ultimately mean people making sacrifices in order to adopt to the worsening economy.

    DePARLE, J. (n.d.). Harder for Americans to Rise From Lower Rungs – NYTimes.com. The New York Times – Breaking News, World News & Multimedia. Retrieved July 15, 2012, from http://www.nytimes.com/2012/01/05/us/harder-for-americans-to-rise-from-lower-rungs.html?pagewanted=all
    Krueger, A. (n.d.). A shrinking middle class means a shrinking economy | The Great Debate. Analysis & Opinion | Reuters. Retrieved July 15, 2012, from http://blogs.reuters.com/great-debate/2012/01/13/a-shrinking-middle-class-means-a-shrinking-economy/

  22. I believe that there is a great deal of potential for Americans to experience economic mobility. However, I do feel that these opportunities have lessened in the past few decades. As a recent college graduate I have had several opportunities with organizations that have each provided me the ability to move up on economic pole. Though in some aspects I believe this has been pure luck others can be attributed to my education, motivation and experience. While in my case I have had the benefit to experience such mobility, I believe Americans that are on the lower end of the scale will have a harder time seeing a large potential for mobility. Representative Paul D. Ryan , a politician from Wisconsin recently stated “mobility from the very bottom up is where the United States lags behind” ( DeParle, 2012 para.4).

    DeParle, J. (2012, January 4). Harder for americans to rise from lower rungs. New York Times. Retrieved from http://www.nytimes.com/2012/01/05/us/harder-for-americans

    • Nathan,
      I do agree with you that there is potential for economic mobility, but that recent college graduates have had a harder time finding a job. I think it was put into our heads when we were younger that all you needed to get a dream job was to graduate college, but that is not the case any longer. In a study by Adecco found that “18% of recent grads have been forced to turn to full-time jobs outside their field of study, often jobs for which a college degree is not required.” (Isidore, 2011). This has been my experience as I now have a job that does not require a degree. However, I do believe that many graduates expect to start out at the same economic status they were currently living in with their parents. While economic mobility is possible, it does take time and does not happen by just graduating with a degree.

      Reference:
      Isidore, C., (2011, 05, 17) The Great Recession’s lost generation. CNN Money. Retrieved from: http://money.cnn.com/2011/05/17/news/economy/recession_lost_generation/index.htm

      • Deidre,

        I agree that there are some unrealistic expectations upon graduation. “Nearly one-third of college graduates have unrealistic expectations for their first job, including both the responsibilities they will assume and the pay they will receive” (Holloway, 2011). Reality is that starting out, graduates need to be flexible and willing to put in some effort for the mobility. It may mean taking a job different from what they envisioned. I think any position is an opportunity to prove yourself and gain experience to draw upon later.

        After all, chances are their parents did not get where they are overnight.

        Holloway, A. (2011, June 8). Grads juggle job expectations. The Columbus Dispatch.

      • Gail and Deidre make valid points. There are unrealistic expectations after graduation about the types of jobs you will be offered and salary. I witnessed this time and time again with my previous employer. I worked in the Career Services department at a local college. I felt it was my responsibility to give the students realistic expectations of what to expect in terms of positions they qualify for and pay rates. In most cases, the students accepted positions in their field of study making less or the same as they did prior to earning their degree. According to the book, “The Education Gospel,” more than half of students who graduate with a Bachelor’s degree or Associate’s degree find employment related to their field. (Albert, 2007) Like, Gail said, the jobs are out there; you just have to be flexible and willing to compromise in regards to salary.

        References:
        Albert, M. (2007, November 30). Bachelor’s degree more common, less enabling. The New York Times, Retrieved on July 24, 2012 from http://www.nytimes.com/uwire/uwire_GWVC113020077032320.html?pagewanted=print

  23. This is a good starting point for the discussion about the
    redistribution of wealth. Does it truly uplift one party and equalize
    the other? Does it drag both down in the long run? Michael Elliot in the article “The New Global Opportunity” however
    offers a supportive view on why distribution is good. He explains that
    not distributing wealth is wrong because, “we diminish our humanity if
    we in the rich world allow billions to live stunted and miserable
    lives…. it’s dangerous because poverty and disease don’t stay
    confined” (Elliot 2010). He even goes on to make better points about
    pathegens, illegal arms which leverage unstable political conflicts.The next argument is for untapped economic opportunities of growth. He believes that by helping undeveloped countries prosper, greater wealth will be spread globally. However, what happens when nations don’t take the first step of development on their own. Are incentives simply removed from society to develope? Simply giving low paying or unwanted jobs to poor countries will not be enough to uplift poverty.

    Elliot M. (2010). The new global opportunity. CNN Money. Retrieved from web:http://money.cnn.com/2010/06/21/news/international/global_forum_opportunity.fortune/index.htm

  24. I think that this whole idea goes back to capitalism. In its beginnings, it was thought of as a “solution” to the problems that were occurring across the globe. “It provides extensive economic, political, and religious fi-eedom. It also provides happiness and perfection on a large scale.” (Alvery, 1998) This theory came about to provide the ultimate “pursuit of happiness.” So has lower wages across the board, or cutting them out completely making us a unhappy, unsatisfied, and unsuccessful nation?
    According to Jack Cafferty of CNN, (2012) [we] the United States once again failed to make the top 10 list of the happiest countries. “The U.S. just missed the cut- ranking 11th in the organization for economic cooperation’s recent report on life satisfaction in the developed world,” while they remained one of the most successful nations.
    As a nation, I believe that we must learn to depend on ourselves one again, using our workers, our products, and our facilities. If we are to use globalization techniques, they should be implemented with care. And with an equalization process that balances standards of living with standards of pay.

    References:
    Alvey, J. E. (1998). Adam Smith’s Higher Vision of Capitalism. Journal of Economic Issues (Association for Evolutionary Economics), 32(2), 441-448. http://ebscohost.com.ezproxy.lmunet.edu
    Cafferty, J. (2012) Why does the U.S. rank as the 11th happiest country in the world? On Jack’s Radar. CNN Associated Press. http://www.cnn.com

  25. The Pew Charitable Trusts have done their fair share of polls on economic mobility and it is interesting to see the results in where we have come from 2009 to 2011 alone. Some of the polls show that “parents are pessimistic about their children’s economic chances but 68% of Americans feel they are in control of their own economic situation” (Lasky, 2011). I believe this supports the “to get a job, you have to have that job already” quote from Dr. Green’s blog. As a young adult I know that I have worked extremely hard in getting the education that I feel I need to be prepared to become a business owner, executive officer, or manager. Throughout school I am always looking for opportunities to broaden my horizon and better myself, with this curiosity I have looked in to different jobs and titles. I found that there are so many jobs that require a person to be experienced in so many things that it almost seemed impossible in my mind that a person just getting out of college, much less grad school, could get accepted for a high paying, high position job. This is heart breaking to see after all the hard work I have put into my education but I know that I am not alone. Many high positions are losing their jobs and having to take tens of thousands of dollars in pay cut.

    Lasky, S. (2011). Economic Mobility and the American Dream: Where Do We Stand in the Wake of the Great Recession?. The Pew Charitable Trust: http://www.pewstates.org/

  26. I believe that mobility in America will continue to produce more losers than winners. Considering that unemployment is rising faster than expected, it is one of the facts why mobility in America will become more difficult. “Profits are rising sharply in the United States, but wages are not. The unemployment rate remains high, and a rapid increase in jobs is not forecast” (Sum & McLaughlin, 2010). As demand of education rises in companies, wages in America decrease, increasing unsatisfied workers around the U.S. In my opinion, the only way mobility will be successful by creating a higher percent of winners will be if most companies decide to keep production and manufacturing of goods in America. I believe that by doing this, as Jessica mentions above, it will help to “balance standards of living with standards of pay” as well as reducing the numbers of unemployment around America and helping mobility within ourselves easier than it is today.

    Sum, A., & McLaughlin, J. (2010). The Massive Shedding of Jobs in America. Challenge (05775132), 53(6), 62-76. doi:10.2753/05775132530604

  27. If the U.S. government does not take more immediate actions to address the inequality between earnings in America, the gap will only continue to widen. The study, entitled “Global Wage Report 2008/09,” reported that since 1995, inequality between the highest and lowest wages has increased in more than two-thirds of the countries for which data is available. The United States is one of the advanced countries where the inequality level is higher. The decline in wages and rising inequalities across the globe, combined with the current economic crisis, presents some difficult problems. Social or political tensions are a legitimate concern for us.

    The inequality of wages for workers globally is not only an ethical issue, but also has a direct impact on sustainable security, economic stability and prosperity for the U.S. and the world. If there are fewer buyers of America’s exports, and we purchase fewer imports, the slowdown in global consumption impacts the world’s economy.

    References
    International Labor Office, Geneva (2010. Global Wage Report 2010-11, Wage policies in times of crisis. Retrieved July 12, 2012 from http://www.ilo.org.

    Luhby, T. (November 8, 2011), CNNMoney, Global income inequality: Where the U.S. Ranks. Retrieved July 12, 2912 from http://money.cnn.com.

  28. The rise in individual inequality that is due in part to the rise in globalisation
    inequality. In unequal societies even those that have mature democratic institutions the rich spend a lot of money trying to shape “rules of the game” in their favour. In countries with immature or non-existent institutions of democracy the problem is much worse: the rich elite pursue anti-competitive policies both in the marketplace, and in politics.

    and there are several reasons why society may care about inequality. First, people’s well-being may directly depend on inequality, for example, because they view a highly unequal society as unfair or because the utility loss due to low status of the have-nots may be greater than the utility gain due to the higher status of the haves. Second and more importantly, equality of opportunity may be harder to achieve in an unequal society. Many economists have, by and large rightly, focused more on poverty than inequality.

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