Modest real wage growth, rising wage inequality, and decreasing labor force participation among less-educated workers have been important labor market trends for several decades. Economists Erica Groshen and Harry Holzer, and a roster of labor market experts present new evidence on the prevalence, causes, and future of these challenges.

Contributors George Borjas and Richard Freeman analyze how the introduction of industrial robots and the influx of immigrants have affected jobs and earnings in the manufacturing industry. They find that the effects of robots are greater than those of immigrants in terms of depressing earnings and reducing employment, suggesting the need for policies that can help workers adjust to automation. Thomas Kochan and William Kimball note the lower density of unions and their declining impact on wages, even as surveys show strong worker preference for union representation and other forms of “voice” regarding wages, compensation, training, and other working conditions.

Informal work, which includes traditional activities like babysitting as well as newer ones like driving for an online platform, is an important means of helping families make ends meet. Katharine Abraham and Susan Houseman show that over a quarter of the workforce hold jobs aside from their main employment, and a higher share of less-educated, minority, low-income, and unemployed workers rely on informal work. Lawrence Katz and Alan Krueger show a modest upward trend in the share of the U.S. workforce in alternative work arrangements over the last twenty years; they also demonstrate that current survey tools miss many instances of multiple job holding.

David Weil demonstrates how the rise of “the fissured workplace”--where businesses outsource key facets of their operations to staffing agencies and other third-party entities--contributes to wage inequality. Contracted workers have lower earnings and fewer opportunities for upward mobility. The U.S. is the only industrialized country that does not provide paid leave for new parents, and low-income families with children spend 30 percent or more of their incomes on childcare expenses. Elizabeth Doran, Ann Bartel, and Jane Waldfogel propose a payroll tax to support family-friendly policies, such as paid leave and child care, as well as modest employer mandates for scheduling control and flexibility.

Editors Groshen and Holzer provide evidence-based policy recommendations that include greater support for public higher education; adjusting federal wage and hour laws as well as those governing labor relations; limiting the effects of past incarceration on workers; and stronger youth employment programs and policies. American workers face many challenges, but there are many policies analyzed in this issue of RSF that hold promise for improving employment and earnings for American workers.

Erica L. Groshen is Visiting Senior Scholar at the ILR School of Cornell University and former Commissioner of the U.S. Bureau of Labor Statistics.
 
Harry J. Holzer is John LaFarge, Jr. S.J. Professor of Public Policy at Georgetown University.
 
 
 
Contributors: Katharine G. Abraham, Ann P. Bartel, George J. Borjas, John Bound, Breno Braga, Charles C. Brown, Elizabeth L. Doran, Richard B. Freeman, Erica L. Groshen, Daniel S. Hamermesh, Harry J. Holzer, Susan N. Houseman, Lawrence F. Katz, Gaurav Khanna, William Kimball, Thomas A. Kochan, Alan B. Krueger, Pamela Loprest, William M. Rodgers III, Demetra Smith Nightingale, Shayne Spaulding, Sarah Turner, Jane Waldfogel, David Weil