In an improving economy, Michigan workers’ part-time blues

A couple weeks after Gov. Rick Snyder issued an upbeat press release about Michigan's falling unemployment rate, Allegan County resident Nicole Jensen wasn't feeling as optimistic.

Snyder's March 8 announcement noted that state unemployment had dipped under 5 percent in January, which showed, the governor said, that “when Michiganders work together to solve difficult challenges, we can have outstanding results.”

Jensen, 31, is not unemployed. But she said her 20-hour-a-week job as a bus driver for a school district south of Holland was just not enough in her household. “It's a real struggle,” she said.

A mother of two children, 13 and 9, Jensen – who said she was in the process of divorce – lives with a boyfriend who recently landed full-time work as a mechanic. But she said their household remains one major expense away from a crisis. She drives a 2002 Honda with nearly 200,000 miles on it, with a transmission she fears is beginning to fail. “It's really paycheck to paycheck,” she said.

On a gray Tuesday morning, Jensen had come to a jobs fair at a Holland Michigan Works! site to buff up her resume and see if she could get a lead on full-time work.

“I'm 31 years old. It's not like we live a life of luxury,” Jensen said. “We don't have cable. I want to have a nice lifestyle, for myself and my children.”

Jensen has plenty of company in Michigan, where approximately 300,000 residents have given up finding work or work part time but want a full-time job.

Michigan's average unemployment rate of 5.4 percent in 2015, the traditional measure of economic health, ranked 29th in the United States. But according to the Bureau of Labor Statistics, 6 percent of Michigan workers in 2015 were looking for full-time work yet stuck in part-time jobs of less than 35 hours a week – 46th in the nation. Only Florida, California, Arizona and Nevada were worse.

To be sure, Michigan's unemployment rate has been steadily falling since the recession, from a peak of 14.9 percent in June 2009 to 7.9 percent in January 2014, 6 percent in January 2015 and down to 4.8 percent in February.

That certainly looks good on paper. But one economic analyst said an improving state and national economy is still leaving many households behind – with the number of underemployed another hallmark of a shrinking middle class in Michigan.

“The unemployment rate really masks a lot of the struggle in Michigan,” said Peter Ruark, senior analyst for the Michigan League for Public Policy, a Lansing-based nonprofit policy organization.

“If you are working 10 hours a week, you are still counted as employed. If you are on the verge of losing your home, you are still counted as employed. It's hard to get in the middle class or stay in the middle class when you don't have full-time employment.”

Ruark said the unemployment rate also cloaks another reality – Michigan's workforce has shrunk considerably since 2000. By his calculation, Michigan had 412,000 fewer workers in 2014 than in 2000. Ruark said these “lost workers” include those who left the state, retired or simply stopped searching for employment.

“Some of them gave up looking,” he said.

Michigan State University economist Charles Ballard attributes the persistence of worker frustration to a lack of fit between worker skill level and employer need.

“I believe part of it is likely to be due to the ongoing mismatch between the jobs that employers want to fill and the skills that some workers have,” he said in an email.

“Those at the bottom of the skill chain, especially high-school dropouts, are at a great disadvantage in today’s economy, and many of them may be the ones who are only able to find a part-time job.”

The Bureau of Labor Statistics officially defines underemployment as the sum of the unemployed, those discouraged from looking and part-time workers looking for full-time jobs. By that definition, underemployment has shrunk in recent years, it's still nearly double its low point of the past two decades. In 2000, it stood at 6.3 percent, before climbing to a peak of 21.5 percent in 2009 as Michigan's economy staggered from the near-collapse of the automobile industry and a steep fall in other manufacturing jobs. Since then it has fallen to 11.4 percent last year.

But the state is far from recovering all the full-time manufacturing jobs shed in the 2000s. According to Michigan's Department of Technology, Management & Budget, Michigan lost nearly 430,000 manufacturing jobs from 1999 to 2009, dropping from about 890,000 jobs in 1999 to 463,100 in 2009. The state now supports about 600,000 such jobs, but that's still a loss of nearly 300,000 such jobs since 1999.

Those losses accelerated a shift toward the service sector, a broad category that encompasses everything from trade and utilities to retail trade, transportation and warehousing, finance and insurance, real estate and accommodations and food services. In 1999, private service jobs accounted for 61.5 percent of employment in Michigan. In 2015, they accounted for 68.5 percent.

At the same time, manufacturing employment fell from 19.4 percent of the work force in 1999 to 13.8 percent in 2015.

Wages, meanwhile, were tumbling.

According to a University of Michigan analysis, the average private sector wage in Michigan in 2001 was $38,532 – more than $1,000 above the national wage of $37,436. By 2012, it had fallen $4,076 below the national private sector wage of $51,541. Adjusted for inflation, private sector wages in Michigan fell by nearly $2,500 for the period, while rising by about $3,000 for all U.S. workers.

The decline in wages hit workers with minimal education particularly hard.

According to analysis by the Michigan League for Public Policy, median hourly wages fell by 32 percent from 1979 to 2013 for those with a high school education, when adjusted for inflation. For those with less than a high school degree, wages fell by a staggering 46 percent during the same period. Workers with some college saw their wages fall by nearly 30 percent.

Even Michigan workers with a college degree during that period saw their wages decline by 4.3 percent after inflation was taken into account.

Only workers with advanced degrees saw a wage increase (10.7 percent). Workers with advanced degrees had median hourly wages of $32.20, compared with $14.65 for those with high school degrees.

And for workers trying to keep things afloat on meager wages and part-time hours, the challenges are considerable.

Kent County resident Laurie Brace, 51, a single mother of one, had been working 40 hours a week for a food service contractor until a couple months ago. She makes just under $10 an hour.

Then, she said, she was cut back to just under 30 hours a week because the firm stated it could not afford the health insurance it was required to offer full-time workers under the Affordable Care Act.

There has been considerable debate over whether the number of Americans working part-time jobs is tied to the act's requirement that employers with 50 or more full-time workers are required to offer health insurance to those working 30 hours or more. A study released earlier this year noted slight shifts to part-time employment in small segments of the work force, but concluded there is “little evidence that the ACA had caused increases in part-time employment as of 2015.”

Either way, Brace realizes she can't meet her household expenses for long unless she finds something better.

“I just got my tax refund of $4,000 back so I'm counting on that for a while.”

When that runs out, she said, “I'll just have to start putting everything on credit cards. There could be some problems.”




In the meantime, she was enrolled in a support program run by a local social service center, North Kent Community Services. It helps single mothers find better employment opportunities, encouraging participants to set personal goals and link with other agencies to find a job or advance their education.

Brace was referred to the Women's Resource Center in Grand Rapids, a nonprofit support organization for women. That led to regular meetings there with a volunteer mentor, who was helping her narrow her goals and craft her search for a better job.

With an associate degree in business management and experience doing payroll and scheduling at a restaurant, Brace is hopeful of landing something in the business field.

While she searches, Brace said she is grateful for the support she's received.

“That really is helpful because you can get really down. It's hard to keep doing it every day when you are not getting anywhere.”

And for some, even a four-year college degree is no guarantee of economic insecurity.

A 2014 study by the Federal Reserve Bank of New York found that more than 40 percent of recent U.S college graduates were working in jobs that did not require a college degree ‒ and of those, nearly 20 percent were working part-time jobs. Six percent were unemployed.

Stephanie Brzezinski, 24, graduated in December from Grand Valley State University with degrees in English literature and journalism.

She's been preoccupied since graduation in a national search for a marketing, editing or communications job. But so far – nothing. In the back of her mind is the reality that she has to begin paying off her $28,000 student loan in June.

Brzezinski moved back to her parents' home in Traverse City after graduation, relieved she can stay rent-free while she searches for work. She has applied as well for full- and part-time jobs in her home town, including at gas stations, grocery stores and retail outlets. She estimates she has put in 200 applications.

At this point, she'd even settle for part-time work as she hopes for something better. That would put her among the officially employed – though not exactly not where Brzezinski intended to be when she graduated.

“Sometimes I think I went to college and I have this degree and it's not really worth anything. It's kind of disappointing,” she said.

“But I try to tell myself, take a lower position, even if it's part-time. Something will come up better down the road.”

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Comments

Matt
Tue, 04/05/2016 - 10:12am
Wasn't the proliferation of part time jobs a consequence pointed out by opponents of Obama-care. If you set the limit at 29 hours why would you be surprised if employers have a 28 hour cut-off? If part time jobs aren't increasing as stated elsewhere in this article, when what was the point of it?
Linda
Tue, 04/05/2016 - 11:58am
Can we please keep in mind the importance of the choices people make that affect their futures? A couple of examples in this article: First, the young woman working as a bus driver. Based solely on the information presented, knowing nothing about her beyond that, I see she had her first child at 18, her second at 22, apparently did not go to college, and is divorcing one man while living with another. I do not believe it is being judgmental to simply point out that her choices over the past 15 years or so have affected her employability and created financial responsibilities. Second, the recent graduate who majored in English lit. and journalism. It's wonderful to go to college and major in something you love, but did anyone counsel her as to what kind of jobs she might find with that type of background? Those degrees in today's marketplace give her access to career choices such as "do you want paper or plastic?" vs. "do you want fries with that?" I have sat in plenty of meetings where decisions have been made to keep positions below 29 hours per week due to the expense of paying for health insurance, so the ACA mandates certainly bear part of the blame. But to point fingers at employers and the government as bearing all of the responsibility over-simplifies the issue. Personal responsibility and wise choices go a long ways towards assuring one's future -- always have, always will.
Observer
Tue, 04/05/2016 - 5:24pm
I am so delighted hear from someone who talks sense.
Jesse Bernstein
Sun, 04/10/2016 - 9:23am
The issue of hiring full-time or part-time or contract workers existed long before the ACA. Federal and State laws required employers to define full vs. part timers and the benefits they received. If a job could be accomplished by two people working 20 hours, the employer could avoid paying certain benefits and if the work was performed by a contractor, benefits, insurance, and taxes could be avoided all together. It was reported this week that employers have not dropped health care benefits as anticipated because they want to attract and retain talent. It is still a relevant cost if employers want to maintain quality. Another issue embedded in this article is the use of contractors. Do I have a job if I get contracts from a variety of employers and individuals? My income can vary dramatically year to year. Maybe we should look at personal income as a measure of personal financial health. Jobs alone may be an outdated measure as technology changes the nature of work.
Sara B
Wed, 04/06/2016 - 10:03am
I frequently hear the same complaint about how young people are just unrealistic about their career prospects when they choose a college major outside of science, technology, engineering, or math (STEM) fields. On the surface, this does look like a valid complaint, but I find that there are three errors of logic behind this casting of blame. First, humans are not "made to order", that it - not everyone has the same skill set. Some individuals will excel in STEM fields due to innate ability, others will flounder no matter how hard they try. Second, it's incredibly difficult to forecast the job market 4-6 years from when you start college. Just ask anyone with a law degree who graduated in the last 10 years. Lastly, and probably most importantly, the only reason wages are high in STEM fields is that there is more demand than supply (yes, labor is subject to the same market forces as all goods and services). If every young person were to take your good advice and study a STEM field, all that would accomplish is that it would flood the STEM labor market and drive wages down. Then we'd be shaking our heads at all those foolish young adults who chose to study STEM instead of "insert new trending field here".
Matt
Wed, 04/06/2016 - 12:22pm
Sara, Who said anything about STEM or a college degree? You're right that many would never be able to cut it. How about a certificate as a pipe fitter or welder or CAD and you'll be better off than many who get their BA. This advice of following your heart ought to get schools sued for malpractice. Maybe a start would be forcing schools to disclose how many or their graduates are actually working in their field of study and their median income before letting a student declare a major. I for one am sick of listening to college grads whining about lack of opportunities and remuneration for their unmarketable degrees.
Linda
Wed, 04/06/2016 - 10:34pm
I was not suggesting STEM as the only fields that young people should choose. I was simply pointing out that journalism and English lit. are not fields which offer many employment opportunities. There are many majors outside of STEM which are in demand, and there is information available from many colleges regarding the percentage of students who get jobs in their fields. Health care is one example; as the population ages, there is a need for more and more employees, and not all of those jobs require science, math or technology skills. And as Matt pointed out, the trades offer a wealth of opportunities for good-paying jobs. The welding and lineman certification programs in our area are giving young men and women skills that translate into full-time jobs with excellent benefits, and if someone completes one of these programs and cannot find or keep a job, it is typically because of poor work habits.
duane
Sun, 04/10/2016 - 3:13am
Sara B., I feel you under appreciate reality, technology and those who have STEM knowledge and skills will be in demand well beyond our lifetimes. We hear more about content but that pales in comparison to STEM. You seem to failure realize that the vast majority of people [kids even more so] have the capacity to learn and apply the foundation knowledge for STEM work. You are wrong when you say, "Some individuals will excel in STEM fields due to innate ability, others will flounder no matter how hard they try." Math and sciences are just like any other subject, their learning is driven by the desire to learn, the willingness to invest the time and effort studying/learning. Your comment is no different than the refrain I heard from my teachers in K-12, 'I'm not a math person' or a 'science person', they were simply saying to whoever could hear them don't even try, don’t be willing to make the effort, don’t risk stumbling, learning math and science is too hard. The reality is the vast majority of student can learn the math and sciences, like a football player invests hours and hours of practice to be good. You rationalize that people shouldn't make the effort to work toward STEM jobs by suggesting that they will oversupply the marketplace and lower the rewards for such work. The average BS engineer is STARTING at over $60,000, with many the fields starting even higher. The engineers have been in that relative position for generations but you seem willing to discourage kids today from even considering studying the math and sciences in K-12 because of what has never happened in your theoretical marketplace. It is a culture of nay sayers that is preventing our students from academic achievement, from learning math and science, and it denys them even the satisfaction of personal achievement. Look around the world and think about who succeeds, it has nothing to do with some special intellectual abilities, it has to do with a culture that has confidence they will succeed, that through their efforts they will learn, and from their sacrifice they will provide for their families a good life. I apologize for my rudeness, too many times I have heard adults say math and science are too hard and students take up that mindset when asked about what they will study. Too many times that attitude has prevented kids/students from learning and from having more choices when they are on their own. There are brilliant people with STEM degrees/job, there are also brilliant journalists and brilliant lawyers, but that does not mean the rest of us can’t succeed in any of those fields. Rather than crush the hopes and possibilities for people, do some homework of your own, then consider giving the some encouragement to try, to risk, to choose. I wonder if you ask all those lawyers you are concerned about not earning high wages what they were told about learning math and science when in K-12, what do think they would say? "Some individuals will excel in STEM fields due to innate ability, others will flounder no matter how hard they try." If you never try you won’t flounder but neither will you even have the opportunity to succeed.
Bill
Wed, 04/06/2016 - 11:39am
Well stated. Personal responsibility for decisions and actions in life are often ignored. It is much easier to project blame than accept personal responsibility.
Nicole
Wed, 04/20/2016 - 12:48am
I was actually 16 when I had my daughter and I graduated and went to college ...my daughter has had medical issues since she was 6....my ex husband was a liar and cheater and abandoned me and my kids and we have been separated for a year...I made poor choices as a teenager but took responsibility for my choices and grew up rather quickly. I did not ask for my ex husband to cheat on me and leave my kids and I, but in return I found an amazing man who is way better for me and to me and my kids. I wouldnt change a damn thing. Unless you are high in the sky and named GOD do not judge me. Have a great day!!
GBreeza
Thu, 06/16/2016 - 4:55pm
lol I actually got to design the schedules while working at Walmart because my managers took advantage of me being too smart for that job while in college. I had to make sure no one worked more than 39 hours and we always had people to close the store. So of course things were complicated because guess who had to check in with their peers to make sure they would actually fulfill their shifts. And guess who had to work hours for people who didn't show up as well as find people to cover my old hours. Ah the joys of part time work. Thank God I graduated and work full time now.