Job Prospects In Cities Dim For Workers Without College Degrees, Study Finds

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The research shows an erosion of middle-income jobs for this group of workers between 1980 and 2015, which has been particularly devastating for those who aren’t white.

Middle-income job opportunities in America’s cities have become increasingly hard to come by since the 1980s for workers without college degrees, a trend that has been especially pronounced for Black and Latino workers, according to new research.

The study by Massachusetts Institute of Technology economist David Autor, seeks to answer questions about why the ranks of workers who do not have four-year college degrees have been thinning in affluent cities during the past 40 years. Autor identifies both “push” and “pull” factors that are to blame here.

On the push side, the cost of living in major cities—especially the cost of housing—has experienced a well documented rise, making it harder for lower-earners to get by and in some cases driving them from cities.

But Autor also concludes that the appeal major cities once offered in the form of higher earning potential has dimmed for people without college degrees. For these workers, there's been an erosion of middle-income jobs offering pay premiums over lower-paid work in less urban, but less expensive areas.

Autor notes how between World War II and the 1980s, cities offered workers without college degrees middle-income, medium-skill positions in factories and offices.

These administrative, clerical and production positions generally weren’t available in rural and suburban areas. It was for this reason that cities became a magnet for people in this part of the labor force, and provided a chance for upward income mobility. 

But in more recent years, factors like automation and manufacturing moving overseas have contributed to a hollowing out of the middle of the urban workforce. Jobs in cities have become increasingly concentrated at the top and bottom of the earnings ladder.

“The set of economically secure career jobs for people without college degrees has narrowed,” Autor said in a statement.

Back in 1980, non-college workers in the nation’s most urban labor markets were about 15 percentage points more likely to work in medium-paying jobs compared to their counterparts in the least urban markets, and also 15 percentage points less likely to work in low paying jobs.

During the 35 years that followed, that dynamic flipped. By 2015, workers without at least a four-year degree in cities were more likely to hold low-paying jobs than people without a college education in the least urban areas, and less likely to hold mid-level pay positions.

In 1990, average hourly wages for non-college workers in the most urban labor markets were about 50 percentage points higher than wages for the same group in the least urban areas. Over the 25 years that followed that premium would fall to just 25 percentage points.

The same wasn’t true when comparing differences in wages for college-educated workers. For this group, the city workers had a wage advantage of 40% more per household in 1980 than their peers in less urban areas. By 2015, this difference had grown to 55%.

Breaking down the findings by demographic group, the study shows that among white workers without college degrees the decline in the urban wage premium between 1980 and 2015 was fairly small. In contrast, the premium fell by five to seven percentage points for non-college Latinos and by 12 to 16 percentage points for Black workers without four-year degrees. 

Between 1980 and 2015, among workers with four-year degrees in urban areas, the only demographic group that saw a relative wage decline was Black men. “The black middle class,” Autor noted, “was more concentrated in skilled blue collar work, in clerical and administrative work, and in government service than non-minority workers of comparable education.”

When it comes to addressing these issues, Autor suggests that boosting minimum wages in some cities could help. He also raises the possibility of adjusting housing programs to help give lower-income people without college degrees the ability to move out of urban areas.

He also cautions that if the coronavirus outbreak puts a lasting damper on business travel or leads to more people working remotely in the longer-term, it could cause lasting declines for lower-paying jobs in fields like food service, cleaning, security and transportation.

A full copy of the paper can be found here.

Bill Lucia is a senior reporter for Route Fifty and is based in Olympia, Washington.

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