How to Escape the Purgatory of Minimum Wage/Part-Time Jobs

Readers responded positively to my recent essay on the emerging economy and jobs: A Teachable Moment: to the Young Person Who Complained About Her Job/Pay at Yelp and Was Promptly Fired

Many young people are stuck in the purgatory of minimum wage and/or part-time jobs: that raises the question: how do you get out of minimum-wage purgatory?

The conventional answer is, “get another college degree.” Perhaps this once had some value, but this now yields rapidly diminishing returns due to supply and demand: everyone else seeking an escape from low-wage/part-time purgatory is pursuing the same strategy, so there is an oversupply of over-credentialed job seekers.

As I point out in my book on jobs and careers in the new economy, Get a Job, Build a Real Career and Defy a Bewildering Economy, issuing 500,000 MBAs does not automatically create jobs for all those graduates: credentials don’t create jobs.

What creates jobs are opportunities to earn high profits via developing profitable skills. Not all businesses are highly profitable; low-margin businesses don’t make enough profit to pay high wages.

Take a high-skill person and put them in a low-margin setting such as fast-food prep (very fast-paced and hard work), and their labor can only generate a limited value for the employer.

Value and profits flow to what’s scarce. Low-skill labor is not scarce–it’s abundant, hence the low wages paid for low-skill work. Workers with credentials are no longer scarce, with the exception of physicians and nurses and a few categories of advanced degrees such as computer science.

What’s scarce are opportunities to earn big profits. Those who have never started a business or operated a business always assume a busy restaurant (for example) is very profitable–but this is not necessarily true. A restaurant with high rent, high labor costs and high overhead expenses could be losing money even if it’s filled with customers every night.

Not only is it not easy to earn a profit, it’s getting harder by the day. Rents are soaring, permits and fees are soaring, regulationary compliance costs more, taxes are higher, minimum wages are rising and competition in most sectors that aren’t protected by the government is fierce.

Employees have to generate a substantial profit for their employers, or the employer will go under. Even large corporations that report big profits are slashing payrolls, trimming bonuses and benefits, and demanding more free labor (though they don’t call it that) from remaining employees. Executives who fail to top profit estimates are sacked.

What’s scarce and what’s abundant? Answering these questions helps us understand the economy and why high wages and profits flow to what’s scarce.

If there’s only one grocery store in town, access to fresh food is scarce, and that store can charge a premium. If there is only one plumber in town, the plumber can charge a premium equal to the travel time that would have to be paid to plumbers in other towns.

In the age of automation, what’s scarce are problem-solving skills. Software and robotics are good with set situations and routines, but not so good at responding to unique situations. If someone wants a high-wage job in a profitable sector, one avenue is to become a better problem-solver.

The best way to become a better problem solver is to start a small enterprise yourself, because the entrepreneur–even the smallest scale entrepreneur selling on Etsy or perfominng some service in the community–must solve a wide range of problems on a daily basis.

Another way is to volunteer for organizations that are woefully understaffed. A beginner will be given responsibilities in these settings that would never be given to him/her in a government or corporate setting.

The more you take on, the faster you learn because you fail often and fail fast. Problem-solving is largely intuitive and a function of experience and networking with those who can help solve the problem.

This is the basis of the eight essential skills I recommend everyone acquire if they want to exit low-wage purgatory.

A third way is to actively acquire knowledge and experience in fields that are not within your chosen speciality. Specialization is not necessarily the best or only way to develop scarce skills; being able to cross boundaries and draw insights from other fields– the opposite of further specialization–makes for better problem-solving skills. Flexibility, adaptability and the ability to bypass rigid boundaries–these are scarce.

Nowadays, virtually every field requires good communication and collaboration skills. Credentials don’t generate these skills–experience is required. Many people complain that they can’t get the experience needed to qualify for a job, so they puff up their resume/CV and lie about their experience.

The better strategy is to get the experience and consciously set out to acquire solid communication and collaboration skills–what’s known as “soft skills” as compared to “hard skills” such as welding or coding Python.

As noted above, there are two avenues: volunteer for an organization you believe in that happens to be woefully understaffed, or start your own enterprise, no matter how small.

What’s scarce and what’s abundant? The answers are not always clear, but the process of seeking answers will be helpful. Finding work you enjoy and developing skills that are scarce–this is the way forward.

There is more on these topics in my book Get a Job.

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  • Mark Bottorff

    Dear Sir Charles,
    You obviously live in a bubble that has virtually no contact with reality. Don’t know where or when you came from, but the facts on the street belie your assumptions-prognostications-advice, etc. I strongly suggest that you actually try to walk a mile in someone else”s moccasins. I have seen enough of your’s and other’s recommendations that have no concept of what life is really like The regurgitation reflex becomes only ever more strong. Local plumbers et al have been almost extincted. These are the days of mega business, big box. Rare indeed are those who can actually pull themselves up by the bootstraps.
    Once upon a time, some of what you advice might have been of value. No longer. The days of work hard and get ahead are dead and they will undoubtedly remain so for the foreseeable future. It is however sometimes possible to really “suck up” and get ahead.
    What’s scarce and what’s abundant? Scarce, decent jobs and opportunities to strike out on one’s own.
    Abundant? People who are totally capable of fulfilling any and all job requirements, and people with enough smarts to make it on their own if they ere only given a chance.
    I strongly suggest that you throw yourself on the street with nothing, and I mean nothing, If that doesn’t work out for you, try one of the other (however many steps) programs Surely one or another of these pontificators must be right. Right?

    • artguerrilla

      yeah, you kind of nailed it…
      while the TOTALLY generic advice isn’t without some good points, it ASSUMES an economy which simply does not exist; and -given the korporatocracy- will not exist unless/until the sheeple bare their fangs at the 1%…
      the whole system is just about locked down for the 1%, and they are sweeping up the crumbs that got left on the floor… the greedtards are astounding in their depths of depravity, yet who is there to stop them when they own the store, own the storekeeper, own the suppliers, own the country, own the kops, own the kourts, and own the sheeple ? ? ?

      • diogenes

        “It ASSUMES an economy which simply does not exist” — exactly.