The Low-Wage, Part-Time New Normal Economy
Consumer confidence numbers have picked up steadily over the past three months, and Americans now feel better about the economy as a whole and their personal economic conditions. Further evidence for this can be seen in the rise in consumer spending in September, at twice the rate of the rise in personal income. Whether it’s the breaking of recession fatigue or an electoral by-product (this sunniness is much more pronounced among Democrats than Republicans), you get a feeling of consumer happiness returning to the economy. I discussed last week where this all could be coming from.
But if this corner has been turned, it doesn’t mean it couldn’t turn back. The potential for a sharp fiscal snap back, a set of measures that collectively would represent more severe austerity than Spain or Ireland and almost as much as Greece, would send consumers back into gloom in a hurry.
The real fear is that consumers have been seduced into a new normal, where low pay and low hours are just a fact of life, and if you get slightly better part-time pay or hours, you grin and bear it. Someone in my life recently found full-time work, but they decided that they could do it without leaving their part-time retail job as well. The idea of leisure time or a job with a living wage and benefits is a luxury that a country without full employment still cannot afford.
While there have always been part-time workers, especially at restaurants and retailers, employers today rely on them far more than before as they seek to cut costs and align staffing to customer traffic. This trend has frustrated millions of Americans who want to work full-time, reducing their pay and benefits.
“Over the past two decades, many major retailers went from a quotient of 70 to 80 percent full-time to at least 70 percent part-time across the industry,” said Burt P. Flickinger III, managing director of the Strategic Resource Group, a retail consulting firm.
No one has collected detailed data on part-time workers at the nation’s major retailers. However, the Bureau of Labor Statistics has found that the retail and wholesale sector, with a total of 18.6 million jobs, has cut a million full-time jobs since 2006, while adding more than 500,000 part-time jobs.
Steven Greenhouse cites technological advances, allowing managers to design retail schedules that just fit the expected demand, for the shift to part-time. I don’t know that you need another explanation other than the fact that it allows businesses to avoid giving benefits to their workers. That’s a huge expense they can do away with. What’s more, part-time workers can demand less in wages, as they see themselves – correctly – as more expendable. As a result, the safety net swells with the working poor, accessing Medicaid or food stamps to survive. And conservative demonize the “entitlement society,” when it’s the consequence of businesses keeping their workers in poverty.
So unless you want to stack up three part-time jobs end to end and hustle your way into the lower-middle class, you’re on a road to poverty at this end of the working scale. Better opportunities do not necessarily equal uniformly positive ones.