OK

If a conspiracy suggestion is on the Front Page, does it still count?  If it's a hint, a whisper, an intimation, rather than a direct call-out, does that exempt it?

A note:  this is my first real 'it's been bugging me for a couple of days and I have to write about it' diary, so please read the whole thing before you decide I'm just doing this to tick people off.

I know quite well that there are major class divisions in this country, and that the differences in income and wealth got to the WTF point years ago.  I don't know how to fix it, but I do know that solving any problem calls for not getting sidetracked into simplistic explanations.

I like the work Laura Clawson has been doing - usually a lot - but this does not add to the solution.  Yes, productivity and wage growth started to diverge in the early '70s, but there are more complex reasons for that divergence than are apparent in the graph.  Follow me below the confused octopus for a fuller explanation of my thoughts on this.

Line graph showing productivity and hourly compensation, 1948-2011. Until the 1970s, the lines rise together. Starting in 1973 and accelerating in 1978, they diverge sharply as productivity keeps rising and compensation flattens out.
Original graph from Thursday's FP diary
A little background here - my mother was a secretary.  Back in the '50s I used to tag along with her when she had to work on Saturdays, so I saw the whole range of what was a 'modern' office at that point.  Plug board telephone system, manual typewriters, seven copies of every letter in different colored paper for various files that needed to be kept up, etc., etc..  When I was an engineering student, I hung around with the secretaries while I was doing co-op work, because they were the only other women around. After I got my degree in 1970, I did a lot of clerical temping during my burnout periods.  So, I've got a pretty good idea of how the clerical workforce changed over the period.

Okay.  Here's my alternative explanation.  Up until the 1960s, the vast majority of changes in workforce productivity were in non-clerical jobs.  Clerical productivity pretty much stagnated.  Beginning in the '60s, all kinds of changes in office systems started showing up.  I tend to think that the first major change was the Xerox copier, but it might have been the telephone switchboard.  To say that secretaries embraced those changes would be to vastly understate the reaction.  And then came the electric typewriter.  And the IBM Selectric.  And the IBM PC.  And WordStar and Lotus 1-2-3, each of which was a really great addition to the workplace.  And computer networking, the internet and T-1 lines, and... Clerical productivity soared over a period of about 30 years.  A study from 1986 shows how the clerical sector "The most numerous occupational group in the economy" was responding to new technology at that time.  It also shows the slowing growth of the sector, even while businesses were expanding.

When you make farming, or auto production, or packaging, or pretty much anything that produces a consumable product more efficient, that means you can produce more product with the same workforce.  When you make clerical work more efficient, it means that you need fewer clerical workers, and most of those you do need are for work which requires less training than it did before.  When a secretary/typist is a perk of upper management rather than a necessity for anyone who generates correspondence or reports, that's a major change in staffing.

My guess (and it's only a guess) is that the shift in clerical productivity and the downgrading of the average clerical position accounts for about half of the discrepancy between 1970 and 1990.  The rest of it?  Well, when efficiencies in production in consumable products get to the point that you can outproduce the needs of your consumers even with a reduced workforce, the incentives for increasing production tend to vanish pretty rapidly.  Once that happens, it's a buyer's market in employment.  If you don't have to worry about competing with other companies to hire good people, the incentives that would make you offer more money and better perks to hire someone vanish just as fast.  I think we hit that tipping point in productivity in a lot of industries in the '80s (maybe even earlier), and the number of industries in which it's happened has been growing ever since.

None of this means the current situation is a good one, only that, one step at a time, each one seemingly a pretty good idea at the time, we've gotten ourselves into a situation where the workforce simply can't use all the people who want to work, at least in the terms we're used to, because we're too good at what we do.  

Are there people taking unfair advantage of this?  Hell, yes.  All over the place. Do we need to do something about it?  Hell yes.  Did it happen because of some vast 40-year conspiracy? Sorry, but I don't think so.

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