How the American workforce has changed since the Great Recession

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December 18, 2019
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How the American workforce has changed since the Great Recession

The last 10 years have been among the most consequential in U.S. history in terms of tectonic shifts that transformed the American workforce. A decade ago, the country and the world were in the throes of an economic calamity the likes of which hadn't been seen since the Great Depression. The Great Recession of 2008 infiltrated virtually every sector and, at least indirectly, every company and worker. The arrival of social media and the smartphone were impacting daily life across every aspect of the American experience, including the workplace. The internet was changing the way human beings bought and sold things and how money changed hands, all of which caused major changes in commerce and the employee/employer relationship.

To dig deeper into how the workforce has changed in the last decade, Stacker explored a variety of sources and compiled 25 trends, technologies, demographic shifts, and other events that forever changed how Americans earn a living.

Some shifts were technological. Freelance-for-hire websites and services like Uber and Lyft launched an entirely new labor structure known informally as the "gig economy." This evolution allowed some people to supplement their existing incomes with independent contract work; others used it as an opportunity to break the chains of the nine-to-five framework that dominated American labor for generations.

Broadband internet made working from home a reality, allowing people to earn a living from anywhere without being limited by geographic proximity to an employer. At the same time, legions of aging baby boomers contributed to a graying workplace by remaining in the workforce well beyond the traditional age of retirement. Keep reading to take a closer look at how the U.S. workforce has changed since the Great Recession.

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Telecommuting takes off

One of the biggest changes in the workforce is that more and more members of it don’t show up in person to work. The number of people who work from home at least part of the time rose by 115% in the decade between 2005 and 2015, according to data from Manila Recruitment. By 2017, 40% more U.S. employers offered telecommuting options than they did in 2010.

The gig economy blossoms

In the last 10 years, huge chunks of the American workforce have traded traditional careers for collections of gigs—or at least picked up side hustles to supplement their incomes. Thanks to the rise of rideshare services and freelance-specific sites like Fiverr, over 57 million people work as independent contractors, per the Gig Economy and Alternative Arrangements study. That’s more than one in three workers.

The workforce is aging

The aging of the massive baby-boomer population has been contributing to a graying workforce since the turn of the 21st century, with the 2010s seeing a dramatic spike in older workers. According to the Bureau of Labor Statistics (BLS), just 13.1% of the workforce in 2000 was 55 and older; by 2024, that percentage is expected to include one worker in four. This dynamic has forced companies to adjust their strategies and benefits packages to ease their aging workforces into retirement.

More older workers ‘reverse retired’

The last decade saw a significant rise in so-called "reverse retirements." About one-in-three retirees now return to the workforce at some point, whether out of necessity or choice, according to a report from the Federal Reserve.

The robots came…and keep coming

Although robots have been working alongside—or in place of—human workers for decades, the last 10 years have witnessed an astonishing rise in workplace automation. "Robots are coming for our jobs" hysteria may not be hysteria at all. According to a report from the Brookings Institution, a full 25% of jobs are now at risk of being replaced by automation, with production, food service, and transportation facing the greatest estimated risk from the robot revolution.

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Manufacturing makes a comeback

The decline of American industry is a sad and well-documented chapter in the country’s modern history—one need look no further than Detroit or Flint, Mich., or any other major Rust Belt city to see the results. The last decade, however, has witnessed a promising rise in the reshoring of American manufacturing jobs. Factories added 176,000 workers in 2017, according to Barron’s, and 264,000 in 2018—the latter was the best year since 1997.

More people take second jobs

Between 1995 and 2010, the American workforce witnessed a steep drop-off in the number of people who work a full-time job and a second part-time job—from nearly 3.5% to less than 2.5% during that time period. During the 2010s, however, that trend steadily reversed, and today the number of people with two jobs is back over 2.5%.

Union membership declines

Collective bargaining and unions built the American middle class, and the hard-fought gains of early organizers paid dividends in the form of lasting gains. Union workers earn better salaries and enjoy better conditions than their counterparts doing the same work in a non-union environment. Those gains, however, are at risk of drying up as income inequality expands. In the 1940s and ’50s, about 30% of American workers were unionized, but that percentage has been in steady decline, including through the 2010s, and today, just 11% or 12% of workers are union members.

Jobs keep pouring overseas

During the 2010s, major corporations of all stripes promised to stop outsourcing jobs wherever they could, and lawmakers promised to hold them to that pledge. Much of that talk, however, turned out to be exactly that—talk. Outsourcing grew by about 1.2% to 14.3 million workers over the last decade, with most of the lost jobs existing in call centers, human resources, and manufacturing occupations.

Retail employment plummets

The so-called "Retailpocalypse," spawned mostly by the rise of e-commerce, has crushed the traditional retail sector and sent once-mighty chains like Toys "R" Us and Sears into bankruptcy. That, coupled with the fact that retail is especially prone to automation, has left retail workers out in the cold in an otherwise booming economy. According to Labor Department data, via CNBC, retail has lost a stunning 140,000 jobs since 2017 alone.

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Job preparation requirements increase

In 1980, 49 million jobs required above-average education, and back then, almost exactly the same number of jobs did not require any special training, according to the Pew Research Center. By 2015, however, 83 million jobs required extra preparation and only 65 million did not—and much of that disparity came during the last 10 years. About 7 million high-preparation jobs were created between 2010 and 2015 alone.

Women scoop up high-paying, high-prep jobs

The jobs that require more preparation require higher social and analytical skill levels, tend to pay more, and their wages grow more quickly compared to the larger job pool—and they disproportionately attract women. Although they make up only 47% of the workforce, women filled 55% of the high-prep, high-pay jobs by 2015.

The workforce becomes more diverse

In 2007, as America remained blissfully unaware of the coming recession, almost two out of three civilian workers were U.S. born non-Hispanic whites, according to the Pew Research Center. By 2017, U.S.-born whites were down to just 60% of the workforce. By 2017, Hispanics made up 17% of the workforce, likewise, roughly the same percentage of workers were foreign born.

Companies develop social media policies

Over the last 10 years, the vast majority of the American population joined social media networks in one form or another. This mass connectivity forced employers to walk a tightrope between allowing and encouraging free speech and expression among their employees and protecting themselves from damage sustained by reckless employee social posts. A relatively new phenomenon, social media policies govern what employees can and can’t say publicly on their social networks.

Health care rises to dominance

Per AMN Healthcare, health-care spending has risen so dramatically that it's expected to more than double to $5.7 trillion by 2026 compared to spending in 2010. As spending grew, so, too, did the entire industry. In 2010, the health-care industry added a little over 13,500 jobs. In 2017, the industry added nearly 16,000 jobs.

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Health-care jobs become coveted and lucrative

The health-care industry isn’t just adding the most jobs, it is, in many cases, adding the best jobs. As rising demand sent the industry soaring, health care became the go-to field for talented, educated workers. By 2019, according to U.S. News & World Report’s rankings, 44 of the top 100 jobs were in health care and many of those positions topped the list of the highest-paying jobs.

Fewer workers enroll in employer-sponsored retirement plans

Employer-based retirement plans like 401(k)s are the #1 way that workers save for life beyond their earning years in the post-pension era. Retirement wealth has not grown nearly enough, and much of the reason has to do with the fact that fewer employees are taking part in such plans. In 2001, 60% participated in a retirement plan, but by 2007, that number shrank to 57%. By 2013, it was down to 53% and continued to plummet through the rest of the decade.

Fewer teens and young adults enter the workforce

As the percentage of older adults in the workforce grew, the percentage of the youngest workers declined. In 2008, 16- to 24-year-olds made up 14.4% of the workforce, but by 2017, that demographic dropped to 13.2%.

More workers are self-employed

The 2010s saw a dramatic shift in workers abandoning the traditional corporate structure to go into business for themselves. By 2020, FreshBooks predicts that 42 million Americans will be self-employed, with 27 million leaving full-time jobs between 2018 and 2020 alone.

Fewer are unemployed, but they're out of work longer

In October 2009, 10% of the American workforce was unemployed, but by 2017, it was just 4.1%. The tradeoff, however, is that they tend to be out of work for longer periods of time. In 2007, just 9.1% of unemployed workers were out of work for a year or more compared to nearly one-third in 2011.

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Seasonal jobs take off

Another significant change is the sheer volume of workers who supplemented their incomes through seasonal jobs, particularly around the holidays. In 2015, the retail industry alone broke a record in Christmas hires only to break it again in 2018. That year, retailers were expected to hire over 700,000 temporary winter holiday positions.

Job-hopping becomes the norm

By 2018, the trend of job-hopping—spending less than two years at a position before moving onto a new job—was cemented in America’s workplace culture. A full 64% of workers had either job-hopped or were considering it because they believed it would help their careers. That represented an increase of over 22% from just four years prior.

A lower percentage of Americans are in the labor force

In 2007, just before the recession hit, 66%, or two-thirds of civilians 16 or older were either working or looking for work. Thanks to the Great Recession and a huge pool of retiring baby boomers, however, that number had dropped below 63% as of 2017.

The shift toward service jobs escalates

The trend toward service jobs has been evident for a generation, but the last decade saw an even greater slide away from goods-producing jobs. In 2007, about 81% of the non-farm labor force was committed to providing some sort of service. Ten years later in 2017, that number had jumped nearly three full percentage points to roughly 84%.

Fewer people work in goods-producing sectors

For every person who goes to work in a service-related job, that's one who isn't working in a goods-producing sector, like mining, logging, or construction. As the service economy booms, the goods-producing economy of old withers away from about 19% of the workforce in 2007 to roughly 16% in 2017.

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