Shift to service jobs

Dramatic effects for the U.S. working class are being wrought by the sustained shift to service from production occupations. The shift is powered by both globalization and technological revolution. One effect of this shift in the U.S. is a large social divide — including a very sharp political polarization — that is fueled by the erosion of “middle” income occupations, especially those related to production.

At the same time, good-paying professional occupations and very low-paying service occupations are the fastest growing categories.

According to the Bureau of Labor Statistics Occupational Handbook, the U.S. labor force grew 12 percent from 1994 to 2004. The top four service occupation categories (by rate of growth) for the same period were professional services, business services, education and health services, and leisure and hospitality, averaging over 30 percent growth rates for the decade.

The growth rates of the top goods-producing occupations other than construction for the same period actually declined by over 10 percent.

The long-term shift from goods-producing to service-providing employment is projected to continue. Service-providing industries are expected to account for approximately 18.7 million of the 18.9 million new wage and salary jobs generated over the 2004-14 period. New jobs in goods-production, however, are projected to be almost exclusively replacement jobs, including in construction.

Employment change in manufacturing will vary by individual industry, but overall employment in this sector will decline by 5.4 percent or 777,000 jobs.

Agriculture is expected to decrease by 5.2 percent, due primarily to advances in technology.

Income gap

If we look at “service” occupations in the broader sense — all work that is not production, maintenance, mining, farming or transportation — the job categories which are expanding show the key sources of the widening income gap within the workforce. The top five fastest-growing occupations in absolute numbers for the next decade are retail salespersons, registered nurses, post-secondary teachers, customer-service representatives, and janitors-cleaners. The top five occupations by rate of projected growth are home health-care aides, network data and systems analysts, medical assistants, physicians’ assistants and software engineers.

Professional workers, food and related service workers and home health care aides vie for first place in projected growth. Over $60,000-per-year incomes on the one hand, and under $30,000-per-year incomes on the other! The latter group is slightly larger than the former, although the greatest growth is forecast for the former.

Alongside these trends, other historically “middle”-income occupations (30K-60K) in maintenance, transportation and construction are projected to grow more slowly than before. Along with their decline, the historical base of industrial unions also diminishes.

However not all service occupations are expanding. Those easily automated out of existence, such as file and office clerks, are fading fast.


Are these BLS projections inevitable? To the extent that the forces of globalization and technological change are objective and irreversible, yes. But globalization in the broad sense — the growth of trade and integration of world economies — can have vastly different outcomes based on which of the many possible strategies nations actually adopt. Increasing the level of U.S. public investment in infrastructure, for example, could slow the manufacturing decline. In addition, both the rate of technological change and what it is directed to are also highly variable depending on public policy.

The challenge of the decade is to find the organizing tools and the common, democratic ground that unites all U.S. workers on a path that protects the promise of a free people to a better life. Refusal to adopt any global policy on trade, or to adopt an anti-science or anti-technology policy guarantee failure. The rapid growth of unskilled occupations alongside the skilled can be a serious threat to any potential positive outcomes. Divided, the working class has suffered dangerous inroads by reactionary forces that undermine support for improved public infrastructure and the support needed to “lift all boats.”

The chief cause of the division is that the new occupations, both the skilled and the unskilled, have little or no voice or organizational strength and are thus more easily set against each other by the contests of well-organized corporate interests.