The U.S. Labor Market Isn’t All That Healthy | Hacker News Reader

The U.S. Labor Market Isn’t All That Healthy

bloomberg.com

102 pointshoward941143 comments

>"The shift to lower wage jobs for entire groups of workers is similarly problematic. Working full time while earning much less than in the past has profound ramifications. Entire industries have been disrupted, and often employees find taking a new job in a different sectors leads to near-entry-level pay -- equivalent to a 30, 40, even 50% salary cut. These folks may be working full time but they clearly are underemployed relative to their experience, skills and past work. This is not captured in economic data."

The US is uniquely unable to cope with this outcome. Health Insurance is tied to employment. Education is costly. Our new mythology of Bootstraps instead of Social Guarantees. I don't see a new robust and dynamic economy coming to the rescue. For those of us currently doing well, this ought to be worrying.

I suppose, but perhaps more worrying to those of us not currently doing well.

If a significant number of people were working now at 30-40-50% reduced wages, then wouldn’t that show up as a decrease in median household income?

Real median household income is at an all time high, up 13% from 2012-2017.

Isn't this the quantity that has barely risen since 1970 or so (till ~2012), while productivity has multiplied manifold? https://en.m.wikipedia.org/wiki/Middle-class_squeeze#/media/...

Further, the median can easily mask such changes as underemployment if it happens in much less than 50% of households, if the "middle class" previously had a broad base. Basically, the middle of the histogram would continue to look pretty flat (same median income for the "middle class") while the width of the flat region would shrink (shrinking middle class).

No, I’m not sure you can reduce wages 30-40-50% for many workers without moving the median down, unless a similar number of workers on the lower side had their wages increased 42-66-100% (that would effectively mean two workers swapping places, which would keep the median the same).

Worth mentioning that the 4th and 5th Quintiles have either not grown at all (in real terms) or even slightly fallen.

Of course compared the the 1st quintile and Top 5% everyone else has been totally screwed.

I think the narrowing of the middle class has more to do with the dramatic rise in housing, education, and health care costs than it does with wages.

https://www.advisorperspectives.com/dshort/updates/2018/10/1...

are you normalizing for how many fte are in the average household? i'm guessing there are a lot of 2-working-parent households now than there were in 1970. and possibly more working kids still living with their parents too.

when you consider this shift, it might allow for a reduction in wages.

just speculation. i haven't looked at the data.

Median is not mean. If everyone under the median suddenly gets no pay at all, or anything under, the median doesn't change.

Median guarantees that at least half of the population has income increased. Mean is unreliable to make any such guarantees. Bill Gates walks in to bar and everyone is millionaire on average.

The middle class is shrinking, but not because they are getting poorer, but because more are becoming upper middle class:

https://marginalrevolution.com/marginalrevolution/2016/06/th...

http://www.aei.org/publication/yes-the-us-middle-class-is-sh...

This piece from the Minneapolis Fed is also worth reading:

https://www.minneapolisfed.org/publications/the-region/where...

A. The time period you mention is post 2008 recession; you would expect the number to go up after such a catastrophic event.

B. Median simply means the middle of the frequency distribution, so you could have a glut of people earning significantly lower than the median, while the upper tail is more or less smooth out to the top end.

C. It's not as easy to find data going back to mid-century, but the trend since the eighties has been largely upward in real terms. Again though, we know that the top 1% has had outsize gains, and it's reasonable to assume that the distribution was more Gaussian in the preceding years.

Yes, absolutely. But in terms of a labor market being “healthy” or not, what are the labor market conditions today if not healthy?

Decades of policy created the environment we are in now, where the bottom 3 quintiles lost out entirely on any gains to globalization.

Now, perhaps more than any time in the last 50 years, we have conditions which could lead to gains for those lower quintiles.

I don’t expect to see decades of losses reversed overnight, but for the last 10 years things have gotten better not worse, which is something new.

Hopefully we are at a point which will start seeing accelerating gains accumulating toward the lower quintiles.

IMO, for that to happen, we need to reduce the supply of unskilled labor to drive increased wages at that point on the curve.

Male labor force participation has been steadily dropping since 1950. This was masked by the entry of women into the labor force between 1950 and 1990. But that process has been saturated for thirty years, whereas male participation keeps failing. That means that absent a major shift, the overall participation rate will continue to decline.

The point is this is a half century trend, much too long to have anything to do with the business cycle. Yes labor force participation today is much lower than the expansions of yesteryear, but that doesn't tell us anything particular about this cycle. Almost assuredly 10-20 years from today labor force participation will be even lower than it is today, even at the peak of the next expansion.

[1] https://fred.stlouisfed.org/series/LNS11300001 [2] https://fred.stlouisfed.org/series/LNS11300002

As far as I can tell, students are not counted as in the labor force. Therefore, as more people pursue advanced degrees and other training later in life, labor force participation drops. Is this a bad thing? Hard to say.

It’s better to look at prime age participation rate (25-54): https://www.bls.gov/emp/tables/civilian-labor-force-particip.... Among men it’s down from 91.8% to 88.5% since 1996.

That's a very interesting chart to look at! Thank you.

One thing to look at is the projected rates in 2026. Non-hispanic white males are projected to be at 64.5 percent in the labor participation rate. This is in part due to the aging of the Baby boomers out of the work force. Still, that means that 1 of 3 non-hispanic white males will not be working and I don't see any reason for the trend to change.

Also, the maximum outflows for Social Security are expected to be in ~2030 [0]. The presidential election cycles are 2020, 2024, 2028, and 2032.

Lastly, the projected temperature of the Earth is expected to be ~0.3 degrees C higher in 2030 than it is today. For reference in terms of the possible effects of climate changes on human politics and government, CrashCourse recently did a good episode on the 17th Centrury Crisis where global temperatures fell ~0.5 degrees C [1,2]. TLDW: things were really bad.

[0] https://www.ssa.gov/policy/docs/ssb/v75n1/v75n1p1.html

[1] https://www.youtube.com/watch?v=cmKHYpC_jVs

[2] https://en.wikipedia.org/wiki/The_General_Crisis

This is a great data point which corroborates “The Organization Man” thesis, which happened to be written in the 50’s.

First of all the U1 unemployment numbers are bogus. Look at the U6 numbers if you want a better picture of the truth. those show unemployment at 7-8%. Anecdotally, amongst my MBA friends, their unemployment level collectively seems to be about 30%.

If you look at where all the jobs are, it seems to be they're all in low cost, low skill areas: waiting tables, dishwasher, etc.

https://fred.stlouisfed.org/series/U6RATE

Looks like we're at nearly an all-time low for the last 25 years as well, no?

You're right.

But, wages haven't improved in the last 40 years for the average person, especially if you compare it to a basket of goods containing the essentials: housing, transportation, medical insurance and education.

This feels like a goalpost move to me

That basket hasn't stayed still, though. Houses are bigger, cars are better, medical procedures are more effective, etc. How much would I have to pay you to convince you to use the average 1979 versions of all of those?

Most people probably already live in places that are older than 40 years.

And there's no automatic reason that doctors and manufacturers should have captured the increased value of their procedures and products.

There's a faulty assumption baked into your comment that most Americans are actually buying/using new things. My apartment building was built in the 1970s, I would happily drive a 1970s muscle car if I could find one at a reasonable price, and in the 1970s you could actually see a doctor without worrying about going bankrupt. Also in the 1970s the building and car would have been new, so I would probably pay you to give me those things today.

> My apartment building was built in the 1970s

Yeah, but in the 70s you'd probably be living in an apartment built in the 1930s. The ones actually built in the 70s were a small minority back then, just like the ones built in the 2010s are a minority today.

I don't think that's true. Remember that there was a massive post-war boom in population and construction starting in the 50s and extending for several decades until the land got used up in cities. Chances are if you were old enough to rent an apartment or buy a house in the 70s, it was built within the last 20 years.

A lot of us live in significantly higher priced 1979 or older housing, which is way more expensive as a percentage of average income as far as monthly payment goes compared to back then.

Similarly with cars, they still got you from a to b in a good enough fashion.

It’s the 80/20 rule, and many people would buy 1979 level items if they were available at 1979 prices.

It also ignores the extreme improvement in the US social safety net since the late 1960s, which is generally ignored in such discussions. That has improved the lives of the bottom 1/3 by a lot, which is not captured at all in the wage growth figures. As one example, it has led to a very large improvement in childhood poverty rates (about a 50% reduction in childhood poverty since the early 1990s):

https://i.imgur.com/OrMwlkT.png

You can also see that wage growth by the bottom half has soared (up four fold since mid 2013), and is now well outpacing wage growth by the top half:

https://i.imgur.com/Mi6mgme.png

Not sure why this is being downvoted. Provided sources and all. Seems like a reasonable comment to me.

I'd love to be able to buy the house my parents bought in the mid-1970s for $35K, it'd be a step up from where I'm at now. It be a good thing if affordable and practical cars like my dad's VW Beetle were more common. And you know, I'd love it if our society had the kind of access to healthcare that we had back in the 1970s. Even in the late 1980s it was possible to graduate from a state college with only a few thousand dollars of debt.

You wouldn't have to pay me to live like that. Though I wouldn't want to go back to the kind of energy infrastructure we had back then.

We made it all illegal, ignoring the fact that not all Americans can afford the fancy stuff. Maybe there was even offense taken that some people would have less-fancy things.

So now our typical building code says you have to pay for copper wires instead of aluminum, you need arc-fault interrupters instead of circuit breakers or simple fuses, you need wired-in alarms in every room, an air conditioner must be installed, balloon construction is prohibited, walls need internal cross bracing, studs must be close together, and on an on. If you can't afford all that, evidently you aren't supposed to have a home.

Likewise, producing the original VW Beetle and selling it would be illegal. You have to have a zillion air bags, all very expensive. You have to have a camera and a screen. You have to have ABS or even traction control. You have to have a catalytic converter. You have to have more than one brake light. The turn signals must be lights. If you can't afford all that, evidently you don't belong on the road.

Purchasing power has stayed stable. Tuition has skyrocketed, medical care cost has increased http://www.mybudget360.com/is-college-worth-it-college-educa..., but technology, apparel, food, and new vehicles have decreased in cost.

> But, wages haven't improved in the last 40 years for the average person

...in the US.

Growing inequality in the US is driven by the fact that capital gains domestically have improved dramatically alongside wage gains abroad, while wage has been essentially stagnant within the US due to globalization / offshoring / outsourcing

The solution, in my humble immigrant opinion, is to train Americans to take on service jobs that cannot be easily automated / performed by cheap labor overseas. But that requires taking an honest look at the country's education system and neither side of the aisle seems to be able to do that without resorting to anger and vitriol

> The solution, in my humble immigrant opinion, is to train Americans to take on service jobs that cannot be easily automated / performed by cheap labor overseas.

It would also require software developers to take an honest look at our industry.

> The solution, in my humble immigrant opinion, is to train Americans to take on service jobs that cannot be easily automated / performed by cheap labor overseas.

What kind of jobs are these?

Trade jobs. Welder, carpenter, plumber, etc.

Do you have reason to think the trades have enough aggregate demand to soak up the entire underemployed population at reasonable wages or is that wishful thinking?

Another question is if this underemployed population could see such great gains by moving to these fields why haven't they already? It may be that they aren't capable of doing these jobs.

Jobs that will pop into existence if we train people for them, I'm sure.

Only if they are willing to accept lower wages which is exactly what we are trying to avoid.

STEM / research jobs and certain niche fields like "high finance" and corporate law. Basically all the things that require a huge investment of time and money to be qualified for... except the education system should make it easier / cheaper for Americans to obtain those credentials versus their counterparts abroad.

Americans should be inventing the machines to replace workers abroad, not competing to be a Foxconn factory worker... This country's biggest competitor is probably Germany, and definitely not China.

Looking at wages is misleading. Total compensation, including benefits, has been going up consistently. Labor’s share of national income has also been pretty consistent. What’s been happening is that the increasing costs of benefits have been wiping out gains in wages. But that’s not a problem with “the economy” as a whole. From the perspective of employers, it makes no difference if an employee costs $1,000 per year because they get a raise or because the cost of health insurance went up.

Now, if education and healthcare is eating up all the gains, that might be a reason to reform those sectors. But there is a big difference between compensation going up but prices increasing quickly in particularly important sectors, and compensation not going up at all. The former is a problem with those sectors. The latter would indicate a structural problem with the economy.

I don't think one can honestly look at employers paying employee's health insurance premium and honestly count that as compensation to the person per se. It's more of a capital expenditure bound to the position in need of being filled by a warm body.

That insurance, in short, is not yours. It is your employer's investment in keeping the occupant of that position a healthy working cog/gear. You just happen to be filling it at the moment.

I really wish we as a society would do a better job at framing these arrangements correctly. You (the employee) never have control of any capital with which to shop around for the best deal. Your employer does. Framing it as belonging to the employee just distorts the picture of what is going where to the point that we can't really say what we're measuring down the road.

> You (the employee) never have control of any capital with which to shop around for the best deal.

You can always choose which career you want to pursue, at least in theory...

That makes no sense. If your employer paid your rent, would that not be compensation to you? After all, you need housing even more than you need health care. Sure, there’s ancillary benefits to the employer from paying your health insurance. But that’s true of your salary as well. Your salary also makes sure you keep showing up for work. From the employer’s perspective it makes no difference. Health insurance premiums spent on you don’t result in a durable capital asset the employer can then use or sell. The only reason employers pay $1,000 in premiums versus $1,000 in salary is that it’s more tax advantaged for the employer (and, now, the ACA makes them do it).

The “distortion” comes from excluding benefits from compensation. It makes it impossible to determine what you’re actually measuring—the share of total income going to employees, or rising costs in one particular sector (that the employer has nothing to do with).

If they only paid my rent in company-owned housing, it would be pretty strange for me to say my employer pays for me house, no strings attached.

But it’s not company owned housing (the premiums they pay to the insurance company is cash out; they don’t get any part of it back as they would if the insurance company were company owned).

And compensation doesn’t have to be “no strings attached” to count as compensation, especially if it is something you were going to buy anyway. With limited exceptions (e.g. live-in nannies), employer-paid housing is taxable as compensation.

There's an element of control that other posters are getting at here. One of the fundamental tenets of a market economy is that consumers get to make decisions on their own behalf when it comes to how they spend their money. If they're not making the decisions, is it actually theirs? There's a pretty big principal-agent problem as soon as you start saying "Well, that money is being spent on your behalf, therefore it's yours." (Ironically, the same problem occurs on the other side of the political aisle with single-payer, government funded health care.)

This is also related to the point you made about possible structural problems with the health care and education industries. Maybe if the consumer could actually choose their health insurer and provider, and there were no exclusive contracts between those two sides of the market, and no barriers to entry for starting a new insurer (and none other than necessary medical licensing of employees for starting a new provider), and providers were required to provide transparent information about pricing and outcomes, healthcare wouldn't be such a clusterfuck of an industry. These are all basic prerequisites for a functioning market, but none of them are present in health care.

What a bizarre comment. Couldn’t you say your salary is also not yours by the same logic? After all, it’s just being paid to the “warm body” in your position rather than “you”.

I read the comment differently and agree with the gp. I'm not allowed to forgo health insurance and take it as cash. I have no agency over the compensation arrangement besides choosing one of a limited amount of options provided to me by my employer.

So, to be clear, you’re saying that because you can’t choose to receive cash instead of insurance that means it’s not “compensation to the person” (to quote the OP)? That’s not an argument that makes sense to me.

You’re not allowed to do that, not because the company wouldn’t gladly negotiate that with you, but because it’s probably illegal under ERISA.

I do not think they are allowed to negotiate away your right to participate in the employer-sponsored plan.

Employees pay for health insurance to attract workers. There are few health care interventions that materially effect someone's ability to do their work that an employee would not pay out of their own pocket.

Employer provided healthcare arose ouf of WWII wage caps as a way of competing for workers. They remain a major part of the compensation package that many workers look at when choicing an employer.

If an employer were to take the extra money they are spending on healthcare and instead pay it in wages, most workers would be (even more) mad at the lowering quality of their insurance coverage (especially considering employers gennerally can get a better deal than individuals).

Not only does the cost of insurance and benefits accrue directly to the employee and absolutely counts as part of total compensation, but so does the employer share of payroll taxes, and even things like health & safety improvements in the workplace like that ergonomic chair you may be sitting in. All of these things redirect parts of the “fully loaded cost” of an employee away from your paycheck, and studying them helps explain why median real paychecks have not grown.

You call out healthcare and education as going up in cost. My understanding is the reason certain industries are becoming "more expensive" (relatively) is because while automation reduces the cost of things like TVs or raw materials, industries like education and medicine still require about the same human ratio of input to output. Ignoring healthcare (which I think has the same problem, but there are way too many other variables), is education getting more expensive or is everything else getting cheaper? If so, will reform actually do anything?

To rebut my own point, I can see restructuring the cost of education even if the cost is roughly the same. You probably wouldn't have AARP talking about student debt for retirees [1]

[1] https://www.aarp.org/money/credit-loans-debt/info-2019/stude...

It’s a lot worse than a lack of productivity improvements.

You might appreciate SlateStarCodex’s article on cost disease.

https://slatestarcodex.com/2017/02/09/considerations-on-cost...

Real (inflation adjust) non-farm compensation (not just wages) has increased by 43% since 1980.[1]

Now, truth be told that a lot of that compensation is just increasing health insurance premiums paid for by employers, but it's inaccurate to say compensation hasn't increased.

[1]https://fred.stlouisfed.org/graph/?id=COMPRNFB,

Of course, if you look at median income, almost all of that increase came 1980-2000: https://fred.stlouisfed.org/series/MEPAINUSA672N

If in 1980 my employer would cover the $30 cost of a doctor's consultation, and today they'll cover the $150 cost of exactly the same consultation, am I better compensated?

Some would say receiving the same thing is not an increase, even if the sticker price is higher.

Came here to say this. It’s unclear that medical care has improved for people as the costs have gone up. If they’ve only gotten more expensive, then in a basket-of-goods analysis, earning power has decreased.

Edit: Just to be clear, obviously techniques and procedures get ever more sophisticated. The question is more specifically whether the average person is seeing an improvement in care that is proportional to the increase in costs. E.g., if office appointment costs have doubled for someone over the past ten years, have they seen a double or greater increase in effectiveness of care? Or is it just more expensive.

Well, age adjusted mortality has gone down by about 1/3 since 1980 and mortality rate for cancer is down about 21%

I think the point is these are separate issues. Compensation is going up - employers are paying more for employee benefits.

The problem is on the medical services side. We're get the same or slightly better medical services for 200-300% the cost.

Economically, that’s simply not the employer’s fault — that the cost of certain employer sponsored benefits has significantly outpaced inflation.

If there are components of compensation which are cheaper to provide now than 30 years ago, receiving the same thing in that case is counted as lower total compensation.

Or to put it another way, if employer share of health benefits stayed exactly the same and employee share took all the hit, and instead, your paycheck increased — leaving total compensation at exactly the same dollar amount — would you consider that as better compensation? Because under that scenario you would be worse off after taxes.

Then 'real' non-farm compensation isn't really inflation-adjusted in a terribly meaningful way, is it? Also, often the premiums aren't paid entirely by employers.

I believe that chart is using the governemnt's CPI to calculate the 'inflation adjusted' part. You can find all sorts of academic criticism of how CPI doesn't accurately reflect inflation (most notably of housing/rent prices), which is now the lion's share of a family's expense in the United States.

I think we have different baskets today, though.

For instance, a 40 year old basket wouldn't have a cell phone or service. (This is a phone, entertainment, takes the place of a set of encyclopedias and maps, a flashlight, camera, etc.) Most families have several of these today.

The U6 figure is tremendous right now. 7.1 in May, 7.2% in June. It's nearly as low as it was at the peak of the end of the economic boom in September 2000. The best we have seen in two decades.

> If you look at where all the jobs are, it seems to be they're all in low cost, low skill areas: waiting tables, dishwasher,

Well of course that's a big part of it. Those are the jobs that get the most wiped out in recessions. People with four year degrees or better see far fewer layoffs and far lower unemployment rates through weaker economic times.

There are ~7.4 million job openings, an immense figure compared to those seeking jobs (compared to what has been normal in the past). Those are not mostly in waiting tables and washing dishes. Manufacturing for one example added 300,000 jobs over the prior 16 months or so.

Two of the job categories that have seen the highest growth from 2006-2016 are educational services and healthcare. [1]

Not exactly what I'd call "low skill jobs".

[1]https://www.bls.gov/emp/tables/employment-by-major-industry-...

That 30% MBA unemployment figure is much more striking to me than the article. Any thoughts as to why your friends can't find jobs? Where were they planning on working?

My guess is that they got their MBA from lower tier university. One of the dirty secrets of MBA programs is that only MBA's from top tier schools (Harvard, Stanford, Wharton, etc.) have significant positive value. The ones from the 2nd tier MBA programs might be worth what they cost if you have reasonable industry experience prior to going for it. Other MBA programs are about as valuable as an undergrad degree in "business". Note, I'm not commenting on the quality of education -- I'm sure many less prestigious MBA programs provide a great education. I know this sounds harsh and insensitive, but from my experience, it is the way it is.

I got an MBA (not from a top school) back in 2010. It has not changed the trajectory of my career in any way as far as I can tell.

I'm a 39 year old Senior Software Engineer. My BS in Computer Science has done much more for me, obviously. In fact, sometimes I forget that I have an MBA until someone corrects me when I fail to mention having a Master's degree, or calls me out for saying something derogatory about people with MBAs :)

It's an anecdotal comment that treats "MBA" as some sort of discernible bucket. Don't call it a striking figure when it's a guess based on a single qualitative observation.

Unfiltered anecdotal comments are often much richer than the kind of piece that makes it through the editorial process of a large publication like Bloomberg. That's not to say I don't take it with a grain of salt.

These are areas like: Data analysis (low-level stuff, like excel, MySQL stuff, etc), Product managements, Project management, etc. Location: bay area. One guy, spent 2-3 years looking for a job before he finally found something in slimy real-estate firm that makes him work day and night and weekends. Some of them are going back for another degree because they couldn't find work and their visa is running out. Another one, just finished a 2 yr contract at facebook and is having trouble finding work (they don't reknew contracts there). Another guy I know, spent 18 months looking for a job before he finally got a contract job at Google.

And yes, these people didn't go to stanford, harverd or any top tier business school.

Many of the executive producers and product managers I knew at gaming companies had to leave the bay area in order to find jobs in that industry, some of them are still unemployed after a couple years. some of them (especially the high level ones) start their own "consulting business" to prevent their linkedIn from looking like they're unemployed. everything looks great from the surface and they don't show up on statistics as unemployed, but things aren't rosy.

> Anecdotally

Where are these MBA’s located?

Are MBA’s not in demand in the Bay Area?

MBAs are appreciated everywhere that requires pricing, managing, product market fit, positioning, finance, analytics skillset. Basically everywhere that wants to make money, including Bay Area.

After the list of "what a healthy worker economy looks like" bullet points I expected some data to show these aren't the case but was disappointed to not find them. As is the case with many articles like this, I can only assume that making the case with words alone means the data does not support their conclusion.

> The gig economy was supposed to create lots of well-paying, independent jobs;

I hate this kind of revisionism. The gig economy was never some sort of political plan that promised anything. It was just the name given to the increasingly common work model. In fact, "creating jobs" was pretty much the opposite of the gig economy.

I don't think it's revisionism. I think it's an accurate description of the hype that surrounded the gig economy. That's what everyone used to parrot in defense of borderline illegal "disruption" by Uber and such.

To quote Ronald Wright, "Socialism never took root in America because the poor see themselves not as an exploited proletariat but as temporarily embarrassed millionaires." The gig economy is just a new way of exploiting that mindset.

I don't agree. Go read the news articles from 2009-2011. The "gig economy" was almost always quite descriptive, about the class of precarious workers forced by the recession to take up piece-meal worker. Only a few CEOs and sycophants waxed poetically about it, and even they stressed that it was mostly a way to make extra cash, not a job replacement.

The quotation gives "The Gig Economy" active voice. The author is saying those who enacted the economic model had the intention of creating those well paying jobs. They obviously never had any intention like that. That statement is revisionist.

The American Dream promised = the american dream was a shared belief and mindset.

Its not so much saying the gig economy was an actor with its own agency, there is an implication that the gig economy was a shared perspective of hope.

I never observed that shared perspective of hope in Uber drivers I rode with, though. It was always a means to an end, not the means to the end. If people thought they were going to end up with a better life, it was because they were finishing their master's degree, or running a software business, or just wanted to stay in the U.S. while their kids got acculturated and educated. Uber was a way to rack up some extra spending money in the meantime. Nobody I've met was under any illusions about their ability to get rich off Uber, except maybe the Uber employees with stock options.

I do think the promise was "easy money on your own time, be your own boss." Something you could do to fill the cracks, without getting a second job. Every uber driver ive ever talked to about it says one of the main reasons they do it is being able to choose when to work.

Conversely, many socialists also don't see themselves as an exploited proletariat but as temporarily embarassed bolshevik central planners.

Too many people think they know what is best for other people, but they often have no skin in the game and suffer no consequences if the choices they make for others turn out to be wrong.

I did a historical search of articles using: "uber on the promise of gig economy" and cutoff articles after 2017

First article has a paragraph that is fairly representative:

https://hbr.org/2016/11/what-motivates-gig-economy-workers

> One of the promises of the gig economy is that workers have more flexibility to work when and as much as they want. That’s why many people start driving to earn extra income outside of their day jobs or in their free time. Hobbyists represent an illustrative segment of part-time drivers in the ridehail workforce. These supplemental earners are comprised of retirees, working professionals, and empty-nesters. Their primary motivation to work is often social. My research suggests that they benefit most clearly from Uber’s employment model of independent contract labor, as they gain more opportunities for marginal employment and are less vulnerable to the same business practices (e.g., rate cuts) that prompt strikes and protests from drivers who rely on Uber as a primary source of their household income.

I ride Uber daily to commute to work. The article describes pretty well my experience with Uber. It is a bimodal mix of (1) people who want flexible, marginal employment and (2) people who make a living out of it. The people who make a living out of it definitely get the short end of the stick.

Is it viable to do Uber flexibly in the US?

In the UK it's not. I looked into it as I'd enjoy driving people about on weekends, and I rarely drink so I could do nights out etc. Assuming you have a car that's suitable, you still need a private hire licence and taxi insurance that make it uneconomical unless you do fairly long hours.

In the US, regulations on Uber are mostly at a state or city level, so in many cities you don’t need that special license, etc (although your regular insurance company won’t be happy if they catch on)

Exactly. Where does it say "well-paying jobs"? They're talking about people who already have jobs or pensions, just making a few bucks on the site, and whose "primary motivation to work is often social", not money.

How is “creating jobs” pretty much the opposite of the gig economy? Almost across the board, gig economy companies have made it more convenient and cheaper to consume services. Both of these changes result in more demand. As more demand is created, jobs are created. You may argue that automation (like self driving cars) will ultimately destroy these jobs but this shift would occur with or without the gig economy. These new jobs that are being created may be rubbish, but the net difference is still job creation.

A job is a position of employment you get hired for. The gig economy may also created paid work, but not jobs. Nobody gets hired by Uber to drive.

> The gig economy was supposed to create lots of well-paying, independent jobs;

Instead it has created companies that vacuum investment cash with no hope of profit and an army of depreciated labor. The economy would be better off if investors saw a return on their investment and if 20% of the gig labor force were suddenly unemployed provided that the freed labor wages are redirected to the remaining 80%.

I'm trying to figure out why the author thinks the gig economy was supposed to create good jobs. It was supposed to create ways for people with free time to earn a side income at around minimum wage, but with more flexibility. The phenomenon of gig jobs getting turned into full time occupations points to how bad the rest of the labor market is for many people.

I'm not sure that it was ever explicitly stated that it was supposed to create jobs, and I never expected or claimed that it would. That said, what I'd like to add is this: a few years after the recession people who were still feeling the employment effects were certainly looking towards the growing gig economy with high hopes that it would create jobs for them. I don't have hard supporting evidence; that position anecdotal and based off conversations with people at that time. I also think that (depending on what sources you read) many journalists capitalized on this to talk up the hype.

Thanks for the response. 100% agree that when gig jobs started picking up, a lot of people were very hopeful about it, especially journalists. But I think a lot of the hope was only on the naive underemployed person side, not on the gig employer side, where the business models can only work with extremely cheap labor (if they work at all).

Or perhaps it points in part to how many people value maximizing freedom over maximizing dollars of income. I talk to most every Lyft and Uber driver; I'd say most of them have a good idea of how much they're making (taking expenses into account) and probably 25% or more specifically enjoy the freedom over the money angle.

(On the other side, that's about the same proportion who wish they could find a "good" full time job but are driving in the meantime to make ends meet.)

The gig economy isn't causing companies to be unprofitable.

Investors have made it clear that they care more about growth than immediate returns. As a result companies delay making money. This is unrelated to the gig economy.

Well, I have long had misgivings about policymakers focusing on single stats as their optimization function.

"Employment" means a lot of things, and a government focused on that simplistic number will probably not produce long term what you want. And we have not incentivized our policymakers / government to do anything but pay attention to that single number. As soon as a politician can claim # of jobs increased, it's as if that alone is great.

What about: - the quality of the job - the pay of the job - the sustainability of the job / industry - where that work takes us as a country strategically?

So here you have people being told that jobs are being created left and right. But scratch even a little bit and you find that they're not very good jobs. Or they're jobs that are strategically not going to help us in the long run.

Interesting facts cited in the academic paper [1] linked in the article:

- Black Americans report significantly more optimism as to their careers and the economy than white Americans; Hispanics polled report something in between those groups.

- Poor Americans score lower than their counterparts in Latin America.

[1] http://www.dartmouth.edu/~blnchflr/papers/jelit%20paper.pdf

It was only the marketing plan of a few companies that stood to profit from it.

The only statistics which needs to be looked at is here:

Bureau of Labor Statistics: Civilian labor force participation rate

https://data.bls.gov/timeseries/LNS11300000

Let the data speak for itself.

A complicating factor not addressed in that graph is the aging of the U.S. population. I don't have great numbers immediately available, but it looks like over that same period of 10 years the population over 65 has grown from about 40million to 50 million. Those people are still considered in that graph as not participating.

Nope - the statistics only covers working age (18-67)

I wouldn't think it's the only statistic that needs to be looked at.

If it does any "speaking for itself" then it's raising its own question: "Why is that number declining over the past few decades?" That requires additional data to answer.

I think it’s quite telling about the bias of hacker news users that this posting is alive and well on top of the first page, whereas a posting about US having the longest economic expansion in history, that was on the front page a few hours ago, was flagged and now gone within minutes of reaching top 10

What does that tell us? That HN trends pessimistic? That the HN audience is under-employed? Or something else?

I may be reading in between the lines but I believe OP's point is that HN leans more liberal which in today's political climate means more receptive of negative economic news (thus necessitating more intervention / change of government control) rather than positive economic news.

But again this could be way off base.

HN may lean liberal, but that would be primarily because half the commenters here are from western Europe, where even the conservative politics are frequently liberal by US standards.

Partially. Also partially because HN users are younger, and younger people tend to hate Republican ideas.

Younger and on the coast. West of I95 and East of I5 you'll find plenty of young people who may find certain social policy points dated but generally agree with republican ideas.

Actually, there was an article on the front page earlier today talking about this phenomenon (social filter bubbles) but it's long gone because everyone was complaining it was a dupe. Go figure.

Interesting. Thanks, I didn't go there at all and I believe ambiguous statements like these create a lot of the misunderstanding that we see in today's political climate.

You don't need economic pessimism to make the case for change in government. The malice and corruption in the executive branch makes the case on its own.

Or just that one contains more information than the other. That the US economy is doing fine is not exactly news.

If you've been on HN for any period of time, the anti-US bias is pretty strong here.

I dont perceive it as anti US bias. Engineers tend to look for what's wrong and try to fix it.

Engineers also tend to identify and describe what's wrong with precision and accuracy in order to identify the proper solutions. The tendency here is to exaggerate or mischaracterize the problems in the US. That often comes along with rose-tinted views of how much better places other than the US are.

None of this is conducive to actually solving the problems the US has. In fact, it's polarizingly counterproductive. I also think it's fair to classify that as a form of anti-US bias.

Look at the number of posts criticizing non-US issues.

There are hardly any.

Bias of the users or bias of the website itself?

Do you think it's important for stories on either side of an issue to get exactly equal coverage here? If so, why?

What does that tell?

The fact that it’s the longest economic expansion in history is obvious to anyone who knows how to read a calendar. I don’t see why that would be expected to get any traction.

Perhaps underemployment and the associated modern issues of affordable housing, working hours, inequality, and distinct lack of wage growth outside tech makes the labour market feel decidedly unhealthy. Even compared to the jobs market of the more turbulent 80s.

Compare that with the post-war boom when there was markedly less inequality, housing was affordable for a couple, and high employment brought wage rises. A boom that brought benefit for a far wider proportion of the population.

What's the point of an economic expansion if most are not a part of it? It's not unique to the US either, most or all of the issues the article raises are replicated across all the developed economies.

Post war boom had the European and Japanese economy offline, and Chinese economy nonexistent. So no globalization threat. It is very unrealistic to compare to it or expect that condition again (unless we are talking about 100% tariffs coming back)

Well that's not true. Europe and Japan powered through the late 40s through 60s with emphasis on rebuilding and exports. In good part that's how Japan built the place they had in the 80s with electronics and cars - through post war restructuring and Deming et al, sustained boom, and exporting. 1960s and 1970s globalisation was the four Asian tigers: Hong Kong, South Korea, Singapore and Taiwan producing the cheap goods we now associate with China.

Even the UK, in the seventies often referred to as "sick man of Europe", had built an unprecedented period of growth, falling inequality, and extreme exporting. The immediate post-war saw "export or die" as the political catchphrase.

The marked difference is, unlike the US who had profited hugely from WW2, those economies started from near bankruptcy in 1945 so took a little longer to reach boom.

Could we reproduce similar conditions? No. Could we have an economy that benefits a far wider proportion of citizens and makes it feel like a boom or expansion for them? Most certainly.

It is true. US inequality rose around 1980. almost specifically around the time of japan (and Asia) and Europe’s rise from ashes and US losing jobs to globalization. They were a mere fraction of their former self before then. Japan’s gdp spikes around 1985. Same with Germany.

That was after post-war boom ended. Mainly as a result of the 73 oil crisis and the follow-on chaos of the rest of the seventies.

https://en.wikipedia.org/wiki/Post-World_War_II_economic_exp...

If you think a single example is "quite telling", you're falling prey to the bias that makes everyone thinks HN is against their favored position. This is a common perception, but a mechanical one. That makes it predictable and that makes it off topic—just look at the lame subthread this provoked.

People with opposite convictions see opposite biases in exactly the same data. It would be no different with a random ranking.

It's a pretty well known and indisputable phenomena at this point that negative news and articles and stories drives engagement and is what gets the clicks and upvotes. While it is true that those with different biases will make different observations, you can be pretty certain that it's very likely that regardless of your bias, you're likely to observe that stories about some crisis or bad news will win out over stories that report good, hopeful news.

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