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Walmart-Logo_color_0Walmart made headlines recently by announcing it is raising its base wage rate to $9 per hour (going to $10 per hour in 2016). In response, Gary Silverman of The Financial Times suggests that “Walmart stirs hopes of a Fordist revival,” referring to Henry Ford’s famous implementation of a $5 day in 1914 – double the going rate at the time. Similarly, Paul Krugman, Princeton economist and New York Times columnist, argues that Walmart’s “wage hike seems to reflect the same forces that led to” rising real wages and declining inequality for nearly three decades after the Second World War.

While the comparison between Walmart and Ford is apt in some respects, unfortunately, the broader institutional context of today’s postindustrial, globalized, financialized economy is far different from that of the post-WWII years. As a result, the move by Wal-Mart is unlikely to signal a broad reversal of the current trajectory of the American labor market, which is characterized by stagnating wages and rising inequality.

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In the lede article in Tuesday’s New York Times, David Leonhardt pointed out that a critical topic has been glaringly absent from the presidential debate: the standard of living of Americans.

Hats off to Leonhardt and the Times for bringing this issue to the front page. Unfortunately, as is typical of the Times and other media outlets, the article was based exclusive on interviews with mainstream economists.

A particularly sharp juxtaposition between economic and sociological analyses of living standards and inequality was posed today with the publication of a symposium of sociologists in the journal Work and Occupations on Arne Kalleberg’s recent book, Good Jobs, Bad Jobs.

Based on his interviews with economists, Leonhard lists the top two causes of “a decade of income stagnation” as automation and globalization. No one to blame here, just impersonal forces we can’t control!

Among a “second group” of forces, he notes rising health care costs and “shrinking” unions.

In contrast, neither Kalleberg nor any of his commenters highlight technology as playing an independent role in wage stagnation and growing inequality, unmediated by the decisions of managers and policymakers. Instead, Kalleberg focuses on the rise of low-wage work, driven by a shifting balance of power between employers and workers as employers, aided by policymakers, engaged in corporate restructuring to achieve flexibility.

Globalization is a key force here, indeed. But rather than viewing it as an impersonal force to which corporations respond, sociologists emphasize how globalization is actively created by American corporations through global outsourcing.

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