The voices of Urban Institute's researchers and staff
August 27, 2018

Five elements of a good job

August 27, 2018

The recently updated unemployment rate of 3.9 percent from the Bureau of Labor Statistics continues a downward trend that began in 2010. By this standard, our economy looks good—most people seeking work have found employment. But as the economy heads toward full employment, researchers and policymakers must ask, are these all high-quality jobs?

In short: No. The nature of work is changing in a way that makes employees vulnerable. Employer-sponsored benefits are diminishing, low-wage jobs are increasing, and growth in contracting jobs has led to fewer employee protections. These trends could lead to a poorer, sicker, less-engaged workforce.

How can employers ensure they’re creating good jobs that benefit employees as well as their own bottom line? Many factors influence whether a position is considered a good job, but the following five top the list:

1. Livable wages

Livable wages allow employees to cover their basic needs, ensuring they can afford to live securely and don’t need to decide between paying the heating bill and buying groceries. If employees earn more, they are more likely to have economic security and save more for retirement.  Adequate income influences worker and family health and financial security. These factors also influence child outcomes.

Providing livable wages also makes good business sense. One study found that an increase in wages and health benefits improved worker morale and effort and reduced wage inequality. And Walmart saw a reduction in employee turnover after increasing worker wages.

2. Mobility and growth opportunities within the company

Most training in the US is provided by businesses and employers, but lower-level workers do not have the same chances for getting that training. Opportunities for workers to improve their skills and advance in their careers are important for ensuring economic mobility. Jobs that offer promotion potential and training can benefit and motivate individual employees, and they can strengthen the workforce overall through human capital investment.

Employees with opportunities for advancement can also thrive in other ways. They tend to feel more satisfied with their workplace and are able to apply their new skills. With more training, they may be able to advance within their organization or in a new job. Firms with a longer career ladder and with significant wage growth better retain employees.

3. Workplace flexibility and schedule control

When employees have autonomy over their schedules, such as their number of hours and start and finish times, they are better able to manage commute times, other jobs, and care giving. And having adequate work hours is important for economic stability because workers can cover their basic needs.

This flexibility can accommodate personal and family responsibilities as well as erratic commutes that affect work hours. This flexibility can also help people keep and perform well in their jobs. Predictable and flexible scheduling may also reduce staff turnover for the employer, and schedule stability can increase profitability.

4. Benefits

Employer-provided benefits such as paid leave, health care, and retirement contributions create a web of supports for employees. But these benefits tend to be more common for higher-income workers. Jobs that offer these benefits promote employees’ productivity and labor force attachment as well as their health and well-being. Private health insurance is also correlated with longer life expectancy for adults as well as a range of child health outcomes.

Urban researchers have found that mothers who use paid leave are more likely to return to work than quit. This is especially true for women of color and less-educated women. Outcomes for children can also improve because of paid leave. New mothers with leave are more likely to breastfeed their infants, have less parental stress, and have healthier parent-child relationships.

Offering good benefits can also benefit the business. One study found that employer-provided benefits, among other factors, were linked to higher job satisfaction and reduced turnover.

5. Working conditions and safety

A safe and supportive workplace protects workers from injuries, physical harm, discrimination, and abuse. Government regulations and business standards affect employee health, employee job performance, and long-term earnings following injury.

Keeping employees from harm also makes business sense. If an employee is injured, they must be temporarily or permanently replaced by a new employee, raising costs for the business. This can slow productivity, reduce workplace morale, harm stakeholder value, and damage public opinion of the company.

Job quality matters for workers and businesses

Businesses can create more good jobs by paying decent wages, providing benefits to all workers, offering advancement opportunities, scheduling hours in advance so workers can plan accordingly, and ensuring a safe and healthy workplace. These factors can have positive effects for both workers and for the business. If employers fail to consider worker health and well-being, policy options can be a nudge. Job quality matters for workers, employers, and their families, and it should be a focus of the employment growth discussion.     

Illustration by sorbetto/GettyImages.

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