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Low-Wage Jobs Don’t Have to Be Dead-End Jobs

Expert Views


Michael A. Schultz
Research Scientist, Economics, Justice & Society

April 2024

Low-wage workers who gain experience and move to a linked occupation are more likely to experience upward wage mobility. 

Americans have an ambivalent relationship with low-wage work. On the one hand, we pride ourselves on being a land of opportunity and mobility, even or especially for low-wage workers. On the other hand, there is a narrative that derides low-wage work and understands it to comprise dead-end jobs filled by and fit for the young and requiring substantial retraining and education to escape. 

I was once one of those young workers. For several years, I worked in retail at a small union grocery store and then later at a large clothing retailer. As Barbara Ehrenreich reports in her classic work, Nickel and Dimed, I found these jobs physically, mentally, and emotionally demanding and far from the moniker of “unskilled labor” often used to describe these jobs in academic discussions by labor economists. 

After graduating from college, I worked at a nonprofit organization in North Carolina with a long history of working with community colleges to support workforce and economic development. North Carolina is known for its community colleges, and it was here that I began to meld the research questions grounded in my lived experience that would lead me to study and teach about low-wage workers’ careers. 

A quarter of workers in the U.S. are in low-wage work.

The U.S. has the highest level of low-wage work among our peer countries, the other wealthy democracies, at about 25 percent of all workers over the age of 25. We define low-wage work in the U.S. as earning below about $15.50 an hour in 2019 dollars. Low-wage workers skew younger, but the U.S. is not Denmark, where the low-wage labor market is synonymous with a transition labor market for youth and immigrants. In the U.S., low-wage work is a persistent problem, having held steady for the last several decades. 

A pressing question in our understanding of low-wage work is whether these jobs are stepping stones—providing opportunities for mobility—or dead ends. This is an important question because how we understand low-wage workers’ mobility influences our approaches to supporting mobility. If these jobs are dead ends, then promoting mobility means getting workers into other jobs. If low-wage jobs are stepping stones, then it is important to understand how these job ladders are created and strengthened, which jobs are linked together, and who moves along the ladders. Implicit in the stepping stone perspective is understanding the labor market as a place where on-the-job training and learning occur, leading to upward mobility. 

Low-wage jobs are stepping stones to higher wages.

My collaborators Ted Mouw and Arne Kalleberg of the University of North Carolina at Chapel Hill and I investigated whether low-wage jobs are stepping stones or dead ends in an article we recently published in sociology’s top journal, the American Sociological Review. We find that low-wage jobs are stepping stones. Low-wage workers who gain experience and transfer that experience to a closely linked occupation—a job ladder—are more likely to move to higher wages. 

Importantly, not all workers experience low-wage jobs as stepping stones. We find substantial variation in the number and size of the job ladders that link low-wage workers in low-wage jobs to higher-paid jobs. This compounds the variation that exists within what we would call low-wage occupations. Many workers in occupations with a high share of low-wage workers earn higher wages, even in the retail, hotel, and restaurant industries, which are often synonymous with low-wage work.

Longitudinal data is needed to understand how these job ladders work.

In the article, we use national-level data, including the National Longitudinal Surveys of Youth (NLSY79), which NORC conducts. In many ways, we are pushing the limits of the sample to study detailed occupations (there are 500 or so in the occupational classification system). Yet, low-wage workers do not work in a national labor market. They work in a particular place. Understanding how these job ladders work and for whom requires more detailed longitudinal data on workers’ careers in particular places. It is likely that not all job ladders from a particular occupation exist in every place, and their influence likely varies with the institutions that support them, whether social networks, community colleges, or other industry and worker organizations. 

A key part of economic development is economic opportunity. Job ladders are one part of understanding the economic opportunity of a place, whether the rural South, Chicago, or any place in America. To be an engine of opportunity, it helps to understand how opportunity works. 

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