Two-thirds of people in advanced economies are poorer than their parents
Brancaccio: So I know we could convene a symposium about the following question, but where might we focus our attention to reimagining an economy where the future for the next generation is not worse?
Manyika: I think one of those is to really think about the role that education plays. One of the things that has declined dramatically over the last 20 years especially is the amount of investment we make in public goods. Public goods is education, infrastructure and so forth, that allows people to be able to participate in the economy. I think we have to focus there.
I think we also have to focus [on] this question of geography of work. It’s striking that we’ve been celebrating job growth that has happened from the Obama years to the Trump years where we’ve created nearly 9 million jobs. Two-thirds of that job growth has been concentrated in 25 cities and dynamic hubs in America, while the rest of them have seen either flat job growth or even declining job growth. So the second place we have to focus on is this question of, how do we make sure that all parts of the country are seeing sufficient investment, there’s enough business activity that actually enables everybody across the whole country to fully participate? We can’t afford to have the kind of geographic concentration of economic vitality that we have right now.
The final one is to reimagine how we make sure that, as our economy does well, we don’t have the staggering inequality that we have. It’s quite striking, if you look at the United States, that over the last 20 years, if you were in the top two quintiles of workers — that’s roughly about 100 million people — this was wonderful. Innovators did well, entrepreneurs did well, investors did well. If you had high skill, high wages, you did well, But for the bottom three quintiles, and that’s about 150 million working-age Americans, this was mostly miserable, because the income inequality was quite staggering. The cost of living for these Americans became unbearable because the cost of housing, education and health care, in particular, went through the roof. So we have to think about how do we tackle these vastly unequal outcomes that we have in the way our economy works.
Chosen excerpts by Job Market Monitor. Read the whole story @ Two-thirds of people in advanced economies are poorer than their parents – Marketplace