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The Agenda

NRO’s domestic-policy blog, by Reihan Salam.

The Decline in Administrative Assistants



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Bryce Covert and Mike Konczal have an article examining the reversal in male and female unemployment trends. While male unemployment losses were a factor in the early stage of the recession; it appears that men have been doing relatively better recently. This is an understandable trend if more males work in highly pro-cyclical industries like manufacturing. However, there also may be long-run structural factors. In particular, the category of administrative assistants appears to be rapidly disappearing:

 

Women have been brutally hit when it comes to a category called “office and administrative support occupations,” i.e. those who make workplaces run smoothly. In this occupation, which represents over 17 million workers, women have lost a total of 925,000 jobs while men have gained 204,000 since the recession ended. Looking into quarterly data for the individual job categories that make up this sector, it’s clear that there have been extensive job losses among administrative assistants, secretaries, and others who support their offices:

 

 

Covert and Konczal interpret this to mean that the remaining workers will do more for less:

 

It falls on other workers to pick up the slack in offices where assistants have been let go. Americans have been working harder without seeing better pay or even new titles. Mother Jones recently reported that Americans put in an average 122 more hours than British workers and 378 more than Germans. As companies trim budgets, employers are “rationalizing” far more positions than usual. This leaves everyone else to pick up the remaining work. In a recent survey by Spherion Staffing, 53 percent of workers said they’ve taken on new roles. Just 7 percent got a raise or a bonus for doing so. Meanwhile, few people are quitting their jobs in this bad market, destroying one of their few bargaining chips and leaving them no choice but to work more.

 

Many administrative assistants and secretaries perform essential office tasks. Their departure will be surely missed, as they understand the various explicit and implicit rules of workflow and protocol that make any organization work. But at the risk of inviting nasty comments from newly unemployed secretaries, one wonders how much the recession has merely accelerating ongoing structural trends that have been increasingly making that class of work less necessary.

Initially, secretaries were principally men engaged in a high status advisory role. The causality is unclear, but the job role came to be redefined to incorporate more women handling the lower-status work of bureaucratic processing. Many handled typewriting functions within the office. The spread of computers again redefined the role to incorporate other aspects of personal scheduling and office management. 

Bluntly: how much is this new role required in a world where we have high-powered email, calendar, and word processing software? Clearly, the day to day life of a secretary involves a great deal of work. But how much of this work has crept up to define the role, and how much to administrative assistants serve as status symbols? How much do secretaries constitute a form of fringe benefits granted to high performers? 

I suspect that the creeping bureacuratization of many organizations — I hear that over half of University staff are no longer professors, though I can’t seem to find a link — isn’t actually making companies more productive. Companies will always have a need for office assistants, and some companies will have a greater need than others. But if the recession is prompting other companies to take a fresh look at their budgets and making them realize that they can update their Google calender themselves; I don’t think that’s so horrible.

The real problem is that incorporating newly unemployed secretaries into the workforce requires properly functioning macroeconomic policy. As Martin Feldstein points out, functioning labor markets can incorporate this sort of thing:

A good indication of the flexibility of the American labour market is the fact that manufacturing employment fell from 27 per cent of all jobs in 1965 to just 17 per cent in 1990 with no increase in the overall unemployment rate because employees shifted from manufacturing to other industries. Another indicator is that the labour force participation rate of adult women rose from 42 per cent in 1970 to 60 per cent in 1990 with no increase in the national unemployment rate. And the US has absorbed some 8m additional immigrant workers between 1994 and 2004 – equivalent to about 8 per cent of the labour force – without any rise in the unemployment rate until the recession began in 2007. 

If we had consistent increases in the path for nominal GDP, structural unemployment losses in one sector would be matched by employment gains in other sectors. The bargaining power of employees, too, would be maintained — perhaps they would now collect in cash the benefits that they once received in the form of administrative assistant services. However, our problem is that the trend path of total spending has remained below trend, and is being revised downwards (closer to what the consumption-based figures would suggest). 

My belief is that the big problem here is self-induced paralysis by policymakers. We all laughed at Japan when they couldn’t seem to get out of their mess — surely, the solutions were so simple? Now Europe and America live in that mess too, and local economists have picked up a reluctance to act. 

I believe that economists were right with respect to Japan, and should have maintained that same attitude when similar things happened here. The Fed has narrowly defined its function to prevent absolute deflation, as hit Japan, but has not broadened its mandate to include a full return of nominal spending back to trend. My expectation is that were they to do so, the problems with secretaries (and so on) would resolve themselves. Instead, they’ve punted and now we’re unsuccessfully patching things through the far less effective channel of government spending. 

But I could be wrong. My views on monetary policy come from Scott Sumner, and are pretty outside of the current mainstream. Either way, there certainly is a messy labor market situation out there. 



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