Polarized Workforce

Job polarization describes a linked set of changes to employment structures in advanced capitalist economies associated with the transition from a manufacturing to a service base. Economic restructuring has polarized the workforce along several dimensions, including in levels of job growth, compensation, job security, and job quality. Although capitalist workforces have long been divided between good jobs and bad jobs, these changes appear to have deepened the divide and reduced the number of middling jobs and the opportunities for job mobility. Job polarization emerged mainly in the 1990s and 2000s and has been most pronounced in the United States, but it has affected a number of European countries as well. Scholars disagree about the causes of job polarization, but key factors include institutional change, technological change, global competition, and the nature of demand in a service economy.

In polarizing economies, the highest- and lowest-wage jobs grow robustly, while middle-wage jobs grow little or decline. Growing jobs are mainly in the service sector, which has long been polarized between high-wage jobs in business services, health services, and professional services and low-wage jobs in retail, personal service, and food service. In contrast, middle-wage jobs in manufacturing have declined significantly, and thus job polarization is highly linked to deindustrialization. A wide range of middle-wage jobs have declined in addition to manufacturing, however, including clerical work and various middling service jobs. The shift to a polarized economy thus appears to be broader than the compositional change in employment from an industrial to a postindustrial economy, a view that is reinforced by evidence of polarization in job quality.

Growing jobs are divided not only by wages but also by levels of job security and the quality of working conditions. High-growth low-wage jobs are increasingly organized by contingent, short-term employment contracts and provide little autonomy and few opportunities for advancement. The middling jobs that have declined so precipitously were also often relatively low skill but were higher-quality jobs, with greater job security and mobility chances, either because they were unionized or because they were embedded in relatively strong internal labor markets in large organizations. High-wage jobs, on the other hand, have seen higher levels of benefits, security, and autonomy, as well as robust wage growth, though some of these benefits have been eroded even for those at the top.