Why The Rich Are Getting Poorer Analysis

Boats in the U.S Economy
As the title suggests, Reich's essay “Why the Rich are Getting Richer and the Poor, Poorer” explains the reason behind the growing discrepancy between the wealthy and the poor. To do so, he uses a metaphor of three boats in which one floating and others are sinking. But what causes one group to stay afloat, while the others drown? According to Reich, regardless of what one person's specific job is, his or her job can be simplified to fit into one of three categories: producers, in-person servers, and symbolic analysts. Depending on the category the person falls into, their job holds a specific purpose and if that purpose is no longer necessary to the U.S economy, that person, along with everyone else in that category, will drown. For the most part, his essay is still relevant to today's economy.
The first group Reich discusses are the producers, which consists mainly of factory workers. Of the three different groups, they are the ones that are sinking most

rapidly. Originally, these workers lived comfortably in the middle class because workers were able to form a united front against managers which protected them from low wages. Employers were also so threatened by work stoppages that they executed caution when adjusting wages. However, this all changed as manufacturing continued to improve and employers searched for methods to earn the largest profit. Outsourcing, technology and the loss of union membership all eventually led to the decline of the producers.
Reich first mentions how outsourcing helped to bring around the devastation of the producers because work stoppages were suddenly no longer a huge threat to employers. If workers wanted to quit, the employer had plenty of people in other countries willing to do the job and at a lower wage. Therefore, the top executives naturally moved their corporations offshore because there would be a larger profit margin. This led to a loss of comfortably paying jobs in the production field. Because the demand for producers so greatly decreased, their pay also withered down to the minimum.
Technology also helped to bring about the sinking of the producers because it made producers less necessary. For one, technology allowed for easier transport of materials which made outsourcing simpler. As if it was not enough that producers had to compete with foreigners, technology itself started to replace the routine producers as factories became more automated. Therefore, even when factories returned to the U.S they were unable to provide very many jobs because the machinery required so little people to function. This, in turn, greatly decreased the amount of producer jobs available.
The loss of union membership is the final factor that Reich claims contributed to the decline of the producer class. Originally, unions served as a bargaining unit, which allowed for workers to have higher wages and benefits. In more recent years, however, union membership faced a sharp decline because unions tended to protect the longest working members. Therefore, young people entering the workforce did not benefit as much from unions and in turn, saw no point in joining one. What the young people failed to notice was that without unions, there would be no bargaining unit to argue for higher wages and protect them from getting laid off. Consequently, some found their pay dwindled if they were fortunate enough to even keep their position. Others found themselves jobless.
Overall, Reich claims that people who held producer jobs were bound to fall into the lower class and they will continue to grow poorer because there are simply no more jobs for them and even if they managed to snatch a job, their pay would be rather pathetic. This statement proves true today. The Bureau of Labor Statistics reports that a majority of jobs in the production field are either growing much slower than average or they are on the decline (“Production Occupations”). Their pay was also found to be less than the average annual mean wage of all occupations. Production workers earned an average of $35,490 while the average for all occupations was $47,230 ("May 2014 National Occupational Employment and Wage Estimates").
The second group Reich discusses are the in-person servers, which consists of service jobs such as nurses, car washers, retail sales workers, etc. Their boat is also sinking, but at a much slower rate. Reich attributes this to the fact that “Human beings...have an insatiable desire for personal attention” (Reich 23). In other words, people will always need someone else to serve them because as humans, they just innately crave that social interaction that technology simply cannot provide. This is especially true for the baby boomer generation, which, by the second decade of the twenty-first century, will be old enough to need nurses and other health care providers. The demand will create more jobs. Also, because their profession requires that they be present, in-person servers do not suffer directly from outsourcing. However, the in-person servers are still sinking nonetheless because they face other challenges including increased competition due to changes in production, population, and technology, no unions, and low wages.
One of the threats in-person service workers face is competition from both people and new innovations. While outsourcing did not directly harm those in these specific professions, it did create a huge influx of people looking for jobs and because many of them could not find another production job, the original producers switched to in-service jobs. They are also forced to compete with a growing number of immigrants. However, the larger threat is the competition that is brought about by new machinery such as automated tellers, vending machines, and online financial transactions that make the human profession obsolete. While the machines may not entirely replace the human beings because of people's need for social interaction, they certainly do reduce the amount of jobs available. This incredible amount of competition means there is more supply for jobs than there is demand. In turn, the pay for in-person servers tends to be rather low.
In-person service workers also suffer from an inability to form unions and the fact that their main customers, the baby boomer generation, cannot afford their services. The competition that was previously mentioned cannot be overcome because there are simply too many varying professions within the overarching service worker definition to form any one united front. In turn, they are forced to work for a lower wage to remain competitive in the market. In addition, by the time the baby-boomer generation is elderly, their main investments, their houses, will be worth less than when they originally bought it due to inflation. They will, therefore, be living off government Social Security which is being paid for by the younger generation which will consist of the in-person service workers. In other words, the workers are indirectly paying their own wages and so, their standard of living cannot possibly improve.
Because of all these obstacles, Reich claims that while the in-person service jobs will absolutely grow, the actual people will still end up with a lower standard of living because their wages are simply too low. Here, Reich is once again proven correct. The Bureau of Labor Statistics finds that personal care and service occupations receive an annual mean wage of $24,980, which is well under the annual mean wage for all occupations ("May 2014 National Occupational Employment and Wage Estimates").
The final group that Reich discusses is the symbolic analyst, which consists of scientists, public relations specialists, engineers, and people in the entertainment industry. They are on the only boat that is floating. Similar to the in-person service group, the symbolic analysts are also experiencing massive job growth and increased demand for their services. However, unlike the other two groups, the symbolic analysts grow with changing technology and they are not affected by the size of the market or production in firms. For example, the people in the entertainment industry benefit immensely from improvements in technology because singers are able to reach a wider audience and film specialists are able to create more interesting scenes with less effort. Also, the symbolic analysts do not suffer from the fact that they do not tend to form unions. The expanding world market is so in need of their insights that unions are not extremely necessary because the symbolic analyst are paid a rather comfortable amount anyway.
Here, Reich's claim is that the symbolic analysts of the world will continue to grow rich even as the rest of the country becomes more and more poor. The Bureau of Labor Statistics once again confirms Reich's prediction as a majority of the occupations that fall into the symbolic analyst group such as business, engineering, and computer science, make well over the annual mean average ("May 2014 National Occupational Employment and Wage Estimates").
Overall, Reich's essay makes certain professions seem rather hopeless.

Producers are doomed to fail, in-person servers will fail eventually, and symbolic analysts will be the only ones left afloat. However, it is important to note that the characteristic that largely differentiates the producers from the in-person servers and the symbolic analysts from the other two groups is education and skill level. The in-person service jobs, especially those on the higher end of the pay scale, tend to require either more education or more skill than those in the producer field. The same applies when comparing symbolic analysts to in-person servers. Therefore, so long as people get an education, they have the potential to end up on the floating boat. In addition, the producer group encompasses a very specific occupation, but the other two groups encompass a large variety of jobs which means there is a much higher chance of gaining a profession that is either sinking slowly or not sinking at

all.