Executive Summary (pdf) 

Between 1979 and 2004, real gross domestic product (GDP) per person in the United States increased about 60 percent. This report asks how well the U.S. economy has done translating this economic growth into good jobs.

The report defines a “good” job as one that offers decent pay (at least $16 per hour or about $32,000 per year), employer-paid health insurance, and a pension. In 2004 (the most recent year for which data are available), only 25.2 percent of American workers had a job that met all three criteria.

In both 1979 and 2004, about one-fourth of workers were in jobs that qualified as “good” by the definition used here. The basically unchanged good jobs rate across the two years suggests that the economy has failed to convert long-term economic growth into an expanding supply of good jobs.

After controlling for improvements between 1979 and 2004 in the “human capital” of the U.S. workforce —American workers today are, on average, older and much better educated than they were at the end of the 1970s—the economy now produces 25 to 30 percent fewer good jobs than it did 25 years ago.

In 2004, about one-fourth (26.6 percent) of Americans were in “bad” jobs, defined as a job that pays less than $16, has no employer-provided health insurance, and no pension. This is close to the share of Americans in bad jobs in 1979 (27.9 percent).

If anything, the analysis presented here may paint an overly optimistic picture of the current economy’s capacity to generate high-quality employment. The data used here for health insurance and pensions do not allow us to control for declines in the quality of many employer-provided health-insurance plans (most importantly the rise in the employee share of the cost of such plans) or for declines in the quality of pension plans (especially the shift from defined-benefit to defined-contribution plans).