Finding a cure to white-collar blues

Black Enterprise, April, 1992 by Bernard E. Anderson

The structural transformation of the American economy coupled with a persistent recession, is playing havoc with the dreams of American youth. The growth rate of white-collar jobs, which were viewed by many young people as tickets to the middle class and economic security, has plateaued.

In the past, jobs in professional, technical, sales and managerial fields were less vulnerable to fluctuations in the business cycle. In fact, to many of the nation's families, a white-collar daughter or son indicated social advancement.

Future growth prospects in white collar occupations are influenced significantly by two major forces: (1) the transformation of the U.S. economy in an increasingly competitive global marketplace and (2) the persistent recession.

The American economy has experienced major structural change during the past four decades. Between 1947 and 1985, the share of gross national product (GNP) originating in manufacturing declined by 11%, while the share in services, finance and related industries rose 23% and 26%, respectively.

The shifts has a strong impact on employment. Manufacturing jobs as a share of non-farm employment declined by 44%. By contrast, the share of service jobs doubled, and financial-industry jobs grew by 50%. Most of the job losses hit blue-collar occupations, but the growth rate of white-collar jobs also declined in manufacturing industries in competitive markets. Slow sales, coupled with increasing competition in world markets, forced many business firms to cut back on white-collar jobs in ways not seen in recent U.S. economic experience. Also, while the growth rate of white-collar service sector jobs increased faster than other jobs, there were fewer such jobs than commonly perceived.

The historical pattern of job growth has been broken. During the first 15 months of the 1973-75 recession, white-collar jobs grew by 636,000. During a similar time in the 1981-82 recession,, they rose by 766,000. But during the first 15 months of the 1990-91 recession, white-collar jobs are projected to have dropped by 15,000. White-collar workers, including executives earning more than $50,000 a year, are spending up to 15 weeks on average to find a new job, and most are accepting lower wages. Almost 400,000 managerial and professional workers lost their jobs during the last 12 months.

America's major blue-chip companies are shedding thousands of white-collar workers. In the last six months alone, IBM corp. announced a reduction of 20,000 white-collar workers, following a similar cut in 1990. General Motors Corp. will reduce its work force by 75,000, including at least 25,000 white-collar workers. Sharp reductions in white-collar employment have also been announced by companies such as Westinghouse Electric Corp. and Xerox corp., as well. In recent months the nation has been losing white-collar jobs at a rate of 2,600 a day. As stated earlier, the threat to white-collar jobs is jeopardizing careers plans for a generation that sees the white-collar sector as an escalator to middle-class life.

A solution to the impending crisis requires action by both business leaders and aspiring professionals. Business leaders must greatly increase their investment in research and development to boost the production of high value-added goods and services. which can compete domestically and abroad. Young people planning careers must focus on acquiring good communication and computational skills that will be highly coveted by business firms that compete in global markets. Continuing structural change in the economy is certain; the response of business leaders and youth seeking careers must be equally resolute.