US Labor Market: Deregulation vs Employee Security | Free Essay Example

US Labor Market: Deregulation vs Employee Security

Words: 1444
Topic: Business & Economics
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Introduction

The current paper pertains to the issues that exist in the modern labor market, in particular, to the problems related to labor market deregulation and workers’ social security in the USA’s labor market. Three articles from reputable media sources are summarized. After that, a critical discussion of these articles follows. Finally, a brief conclusion is provided.

Article 1 Summary

The article by Mulcahy is related to the situation which can be observed in most contemporary labor markets, and in the U.S. labor market in particular. The author explains that today, companies stop providing their workers with professional, financial, or social security and that instead, both organizations and employees tend to prefer “more flexible and independent work arrangements” (Mulcahy par. 4). Full-time jobs are vanishing, and businesses tend to seek part-time workers, as well as to use the services of freelancers or outsourced labor. Furthermore, companies are stated to avoid hiring full-time employees, for they are an expensive and non-flexible type of labor. The author claims that part-time work permits for “choice, autonomy, flexibility, and control that drive worker satisfaction,” and that full-time employees tend to lack these (Mulcahy par. 14). Therefore, Mulcahy recommends that individuals stop looking for full-time jobs, instead of focusing on seeking part-time, freelance work.

Article 2 Summary

The article by The Editorial Board is also related to the American labor market. It discusses the problem of the growing percentage of men that are not employed and not seeking a job. It is stated that in the middle of 2016, nearly 7 million men aged 25 through 54 (11.4% of the total male population of this age) were not employing or looking for work (The Editorial Board). Nearly 40% of these males reported having pains that do not permit them to work in their area of qualification; furthermore, approximately 1/3 of the named population had trouble walking, climbing stairs, or suffered from some other disability (The Editorial Board). Many of these men regularly took painkillers or used other prescribed medication; most of those taking the painkillers reported experiencing pain every day (The Editorial Board).

The authors stress that it is hard to tell whether the health problems of these men preceded their absence from the job market, or vice versa; however, experts are stated to emphasize that the use of painkillers is a consequence of being jobless, for people without employment prospects often experience depression, drug addiction, alcoholism, and mental health issues (The Editorial Board). Also, only 2% of males were found to receive compensation for job-related injuries (The Editorial Board). The authors conclude that, while additional research is needed, public policies pertaining to the labor market should be revised so as to address these problems (The Editorial Board).

Article 3 Summary

The article by Irwin also pertains to the issue of flexible labor markets. Irwin mentions the millions of Americans who do not work and are not looking for work, even though they are of the working-age; these individuals are mostly males with low levels of education. It is stressed that in 1964, nearly 97% of males who had the levels of education not exceeding a high school degree were either working or unemployed (i.e., looking for work); in 2016, this the proportion of such individuals was only 83% (Irwin).

The author assumes that this problem is related to the deregulated market of labor in the U.S. (Irwin). Of course, such deregulation means that it is easier for companies to create jobs and recruit workers, which is why economists have believed for a long time that, despite the inequality that it leads to, this situation will turn out as beneficial, permitting the economy to better adapt to the changing world (Irwin). However, Irwin stresses that it is probably better security that prompts individuals to seek jobs, whereas lower security and worse working condition dissuades them from doing so. In addition, the “astronomical incarceration numbers” in the USA also take a large number of poorly educated males from the labor market, for finding a job with a criminal record is exceedingly difficult in that country (Irwin par. 13). On the whole, the author summarizes that the public policy should be aimed at making labor markets more supportive and that such adverse consequences of deregulation in this sphere as opioid abuse, high rates of depression, early death, etc., should also not be overlooked (Irwin).

Critical Discussion

Whereas it is apparent that the article by Mulcahy does describe the trend which exists in the modern labor markets, and in the American labor market, in particular, the author apparently overlooks a wide range of nuances pertaining to this trend. The most obvious aspect that seems to be overlooked (or ignored) in the article is that the market is not an ideal object which develops according to its own laws and independently of everything else. Companies do not tend to hire part-time workers because it is a trend in the market; rather, it is a trend in the market because companies tend to hire part-time workers. They do it because it is more profitable to them, and because the legislation (probably influenced by the interests of businesses) does not require the provision of employee security (or minimizes such requirements), thus permitting them to do so. Therefore, the issue of the vanishing full-time jobs is actually a problem of the government’s public policy. And it is possible to attempt to change this policy so that secure full-time jobs would not be a disappearing phenomenon.

There also might be strong reasons for supporting such a policy; while it is true that, as Mulcahy notes, the full-time workforce is inflexible and expensive for businesses, it is also true that for workers, “flexibility” often means that they need to work whenever it is needed for companies (rather than convenient for workers); that employees are forced to constantly spend time looking for work; that they usually do not enjoy social benefits such as the medical insurance; and so on. Thus, while part-time labor is cheap for companies, it is very expensive for workers themselves; it wastes their time, deprives them of e.g. ability to gain medical attention (which is a serious problem in the U.S.), makes them socially and economically insecure, etc. On the whole, the expenses pertaining to the workforce are transferred from companies to workers when full-time jobs are replaced by part-time work, freelancing, outsourcing, and so on.

The articles by The Editorial Board and by Irwin support the provided criticism of Mulcahy’s claims. The traditional assumption that the deregulated labor market should allow for multiple benefits, including a quicker adaptation of the economy to the changing trends in the world, is probably not disproved by the mentioned problems of the workforce; however, these problems reveal some of the costs of such deregulation. The described situation in the American labor market leads to serious social problems, including the above-mentioned depression, drug addiction, alcoholism, and so on (The Editorial Board). Furthermore, as Irwin points out, it is difficult for individuals with a criminal record to find work in the U.S.; however, the author did not mention that many of such individuals probably commit a crime and become imprisoned due to the absence of any real prospects in their life, particularly because of the low chances to find a decent job.

On the whole, the three discussed articles reveal that there exists a highly adverse situation in the U.S. labor market. On the one hand, there is apparently a lack of job offers and an abundance of labor supply, which seemingly justifies deregulating the market so that it would be easier for new businesses to hire employees, which should cause them to hire more workers (Irwin). On the other hand, the extremely low quality of the jobs offered causes millions of people to lose hope and stop looking for work entirely (The Editorial Board). It might be assumed, then, that while increasing the quality of the offered jobs by obliging firms to provide social security and better conditions for their workers, and hiring mainly full-time employees, might not help solve the lacking demand for workforce, it may at least improve the lives of those who managed to find work in the American labor market.

Conclusion

All in all, the discussed articles reveal that the deregulation of the U.S. labor shifts the burdens related to the hired workforce from the companies to the workers, which apparently results in low employee economic and social security, social problems such as drug addiction, health issues, and the situation when individuals of working age stop looking for a job. It is possible that a public policy increasing workforce security might help address these problems.

Works Cited

Irwin, Neil. “Would America Have Fewer Missing Workers if It Were More Like France?” The New York Times, 2016. Web.

Mulcahy, Diane. “Why I Tell My MBA Students to Stop Looking for a Job and Join the Gig Economy.” Harvard Business Review, Web.

The Editorial Board. “Millions of Men Are Missing From the Job Market.” The New York Times, Web.