The Increasingly Endangered Middle-Skill Job

It’s a tough time to be a bank teller, production worker, or other so-called “middle-skilled” professional.

For at least a few decades, employment in those positions – which have historically offered workers without a college degree a berth in the middle class – has been falling sharply. About 25% of the employed workforce in 1985 held middle-skilled jobs; now just above 15% hold those positions, according to a new paper from the Federal Reserve.

Using data from the Department of Labor, Fed economist Chris Smith examined what happened as people moved from one kind of occupation to another, and especially what became of workers in what he calls “middle-type” jobs after they were laid off, fired, or switched careers.

Generally, this hollowing out of the middle of the labor market has hurt younger workers and those without college degrees, many of whom wound up in lower-paying occupations—from bookkeeper to retail clerk, for example. For these demographic groups, the shift away from middle-skilled employment almost exactly mirrored the increase in so-called “low-type” employment, he writes in his paper, titled “The Dynamics of Labor Market Polarization.”

Employers and community colleges often complain that young adults aren’t preparing themselves for careers on modern, highly-mechanized factory floors. While those jobs may be going unfilled, many middle-skilled office workers, such as receptionists and bank tellers, have simply seen their jobs automated or outsourced away, as economists like David Autor and David Dorn have shown.

That trend has especially hit women from 25 to 54 years old without a college education. That group, which is highly represented in those office and administrative support jobs, has seen the sharpest decline in middle-type occupation. In 2012, about 30% of the employed women in that group were in middle-type jobs, down from around 45% in 1985, according to Smith.

In the same period, lower-paid, lower-skill jobs, such as retail clerks and food-service workers, saw the numbers of non-college-educated women rise rapidly.

The paper doesn’t parse out whether the shrinking population entering middle-type jobs is a result of fewer openings, as companies shed those mid-level jobs, or a lack of qualified workers with the skills for positions in, say, advanced manufacturing.

One thing is clear, though: polarization in the labor market isn’t slowing down anytime soon, so young and old workers in middle-skilled jobs or without college educations will remain under pressure to develop the qualifications for higher-level careers – or risk falling into the ranks of poorly paid service workers.
Article Source WallStreet Journal
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