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The New Technology and the New Economy: Some Implications for Equal Employment Opportunity THIERRY J. NOYELLE Are sex and race still major determinants of employment dis- crimination? Is the new computer technology changing the de- mand for labor to such an extent as to reshape the terms under which women and minorities encounter discrimination? As ~ argue in this paper, using evidence from empirical studies of the retail, insurance, Ed financial sectors, both questions deserve qualified answers (Noyelle, 1986; 1987~. While major advances have been made in alleviating sex and race discrimination in the workplace, discriminatory barriers based on sex and race remain. Still, other bases for discrirn~nation, which in the past played a lesser role, loom larger today. For example, there may be an increasing tendency to use age to differentiate youth and some groups of older workers from others in the labor market today. During the l950s or 1960s, the age factor seemed relatively unimportant. More significantly, the role played by socioeconomic status may be growing in importance because of its implications for access to formal schooling and higher education. While our economy places increasing value on formal education as a criterion for hiring, our society continues to lag behind in providing equal access to quality education. 373
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374 EQ UAL EMPLOYMENT OPPORTUNITY The new technology is changing the nature of many jobs and skills and, as a result, is redefining the demand for labor. In the process, it is loosening the hold of particular groups of workers on specific occupations. But its displacement effects are not re- stricted to women and minority workers. At the same time, the new technology cannot be viewed in isolation. Deep economic and social changes and dramatic industry shifts have acted to alter the overall occupational structure and to increase the importance of formal schooling and higher education for employment opportu- nity. The new wave of technological change simply reinforces these trends. The overall thesis of this paper is straightforward. ~ argue that the current labor market transformation is altering fundamentally employment and mobility opportunities by changing, in particular, the need for training and the way training is provided. Further, argue that this transformation has disturbed an earlier balance among sources of discrimination. A principal conclusion of the paper is that while direct equal employment opportunity (EEO) enforcement in the workplace must continue, the reach of EEO enforcement must be widened from an almost exclusive focus on the workplace to one that links the workplace to the educational arena. At the federal level, this may require a redefinition of the scope of activities of the Equal Employment Opportunity Commission (EEOC) through new leg- islation, since, under Title VIT of the Civil Rights Act of 1964, the scope of the Commission is largely restricted to the workplace. Currently, equal opportunity in federally financed educational pro- grams is mandated by other portions of the 1964 Civil Rights Act, as amended, and other legislation, and is the responsibility of other federal agencies. Enhancing equality of opportunity in the transformed labor market may well require a consolidation of en- forcement power and an awareness of the increasingly important link between the two. The paper is divided into three main parts. The first part traces trends in aggregate employment data and shows which groups of workers have tended to gain in their employment oppor- tunities and which have tended to lose. The second part empha- sizes key changes that have occurred in the structure of the U.S. economy and the concomitant changes in the demand for labor. The third discusses the changing nature of discrimination with
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THIERRY J. NOYELLE 375 examples from back-office and retail employment and with spe- cial reference to various groups of women and minorities. Policy implications are discussed in the conclusion of the paper. TECHNOLOGY AND DISCRIMINATION: EVIDENCE FROM AGGREGATE DATA FOR 1970-1980 What can be discerned about the critical linkages between technology and discrimination from employment aggregates? To seek some answers, ~ developed two sets of measures one based on decennial census data, the other on EEOC data. Table 1, based on 1970 and 1980 census data, presents an in- dustry shift-share analysis for six major groups of workers: youth (ages 16-19), black females, Hispanic females, white females, black mates, bind Hispanic males. For each group, employment growth (or decline) in an industry has been broken down among three components: first, growth (or decline) associated with the relative growth (or decline) of the industry; second, growth (or -declined as- sociated with an increase (or decrease) in the group's participation in the employed labor force; and third, growth (or decline) associ- ated with the pure "shift" of the group in or out of the industry. In other words, the "shift" measure indicates the gains or losses in a given group's penetration in a particular industry, everything else being held constant. For each group, the "shift" measure is shown as a "turnover" ratio indicating the number of workers "shifted" during the 10-year period shown as a percentage of the group's 1980 employment. In addition, the positive and negative shifts are distributed in percentage terms among industries. The overall impact of the shift is shown by means of normalized shares for 1970 and 1980. The share of employment of a group in an industry is divided by its share in the total labor force. This ratio shows the group's standing in an industry relative to the economy as a whole. A ratio below 1 means that the group penetration in the industry is lagging; a ratio above 1 means that the group is overrepresented. For example, Table 1 shows an aggregate turnover measure of 2.6 percent for white women, indicating that 2.6 percent of the 34,806,839 white women found themselves in 1980 in an industry different from that in which they would have been employed had there been no change in the penetration of white women in various
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376 ED UAL EMPL O YMENT OPP OR T UNI T Y TABLE 1 Industry Shifts of Major Groups of Workers and Distribution of Positive and Negative Shifts Among Industries Employment Distribution: Youth (16-19 Black Hispanic All Sexes, Years Old) Female Female Races, Ages Normalized Normalized Normalized (percent) Share Shift Share Shift Share Shift Industry 1980 1970 1980 1970 (percent) 1980 1970 (percent) 1980 1970 (percent) 1. Health 7.4 5.5 0.68 0.93 -21.3 2.35 2.35 +0.3 1.42 1.81 -23.6 2. FIREa 6.0 5.0 0.67 0.85 -13.2 1.03 0.70 +15.1 1.23 1.17 +3.4 3. Social 1.8 1.6 0.87 0.70 +3.1 2.13 1.32 +10.5 1.48 1.18 +10.7 4. Business servicesb 6.6 5.7 0.72 0.90 -14.7 0.60 0.85 -10.6 0.73 0.83 -6.6 5. Education 8.6 8.0 0.62 0.75 -13.5 1.59 1.49 +9.4 1.14 1.11 +12.4 6. TCU- 7.3 6.8 0.33 0.59 -23.2 0.71 0.44 +14.8 0.52 0.49 +6.8 7. Wholesale 4.3 4.1 0.71 0.68 +0.8 0.34 0.32 +0.8 0.71 0.81 -7.3 8. Construction 5.9 6.0 0.71 0.52 +12.9 0.10 0.06 +1.4 0.14 0.11 +0.8 9. Public adm. 5.3 5.5 0.40 0.37 +1.9 1.51 1.07 +18.2 0.90 0.73 +16.8 10. Consumed services— 20.3 21.4 2.46 2.11 +80.6 1.06 1.70 -86.1 1.23 1.39 -62.5 11. Other goods- 4.0 4.5 1.06 1.02 +0.7 0.20 0.33 -3.4 0.59 0.56 +0.2 12. Manufacturing 22.4 25.9 0.60 0.64 -14.1 0.78 0.60 +29.4 1.14 0.96 +52.3 1980 Employment 6,973,441 4,659,177 2,168,649 Turnoverf 8.3 13.9 5.7 NOTE: The 12 industries are ranked by rate of growth between 1970 and 1980 from the fastest growing (health) to the slowest growing (manufacturing). The industry breakdown used is based on classification of service industries found in Stanback et al. (1981). The first two columns show the distribution of all employed among the 12 industries in 1970 and 1980. The positive and negative "shift" is distributed for each group on a percentage basis. The normalized shares of major groups of workers shown for 1970 and 1980 are computed by dividing the share of employment held by each group in each industry by that same group's share of employment in all industries combined. An index below .00 indicates underrepresentation; above 1.00, overrepresentation. For definition of "shift," see text. Finance, insurance, and real estate. ~Legal, accounting, advertising, and the like. Transportation, communications, and utilities. Retailing and personal services. Agriculture, mining. Total shift for given group measured as percentage of 1980 employment. See text. SOURCE: Bureau of the Census, 1974, 1984.
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THIERRY J. NOYELLE TABLE 1 (continued) l Industry 1. Health 2. FIREa 3. Social 4. Business b ser~rices- 5. Education 6. TCU- 7. Wholesale 8. Construction 9. Public adm. 10. Consumers services~ 0.72 0.74 -16.7 11. Other goods~ 0.88 1.30 -37.8 12. Manufacturing, 1.29 1.21 +52.9 1980 Employment 4,674,871 Turnover-f 4.3 Hispanic Male Normalized Black Male Normalized Share Shift _ _ 1980 1970 (percent) 1980 1970 0.65 0.58 +7.7 O.S8 0.53 0.84 0.86 0.82 0.84 -4.9 0.68 0.54 +16.4 1.72 1.45 +38.5 O.96 1.00 -7.2 1.37 1.56 -29.5 1.33 1.32 -1.7 377 White Female Normalized !:;hare Shift Share (percent) 1980 i970 . 0.42 0.46 -3.4 +4.5 0.54 0.61 -8.S -2.1 0.48 0.61 0.98 0.96 0.42 0.45 1.12 1.17 1.18 1.25 1.70 1.47 0.87 1.12 -7.4 +7.2 -6.9 -11.3 -11.S +34.4 -44.0 0.90 0.90 -2.9 2.04 1.97 -4.5 1.26 1.10 +58.4 3,288,208 S.S 1.74 1.93 1.43 1.41 1.45 1.32 0.92 0.£;0 1.53 1.70 0.56 0.59 0.67 0.65 0.21 0.17 0.88 0.77 1.30 1.28 0.40 0.27 0.72 0.77 34,806,839 2.6 Shift (Percent) -28.4 +14.7 +8.1 +11.5 -37.9 -1.5 +4.7 +10.8 +25.8 +3.4 +20.9 -32.1
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378 ED UAL EMPLO YMENT OPPOR TUNI T Y sectors of the economy between 1970 and 1980. In addition, the ta- ble shows that this shift was primarily due to increased penetration in public administration (explaining 25.8 percent of the positive shift); other goods (+20.9 percent); finance, insurance, and real estate (FIRE) (+14.7 percent); and business services (+11.5 per- cent), matched by decreased penetration in education (explaining 37.9 percent of the negative shift), manufacturing (-32.1 percent), and health (-28.4 percent). On the whole, Table 1 points to the following: industry shifts were extensive among black females (turnover of 13.9 percent for the entire group) and youth (8.3 percent turnover) and rather lim- ited among white females (2.6 percent turnover), Hispanic males (3.3 percent), and black males (4.3 percent). The largest exit move for black females was out of the personal services industries where large numbers used to be employed as domestic servants. Their greatest gains were in manufacturing (+29.4 percent); public administration (+18.2 percent); and FIRE and transportation, communications, and utilities (TCU) (+29.1 percent combined) where they made substantial gains in clerical work; and the educational sector (+9.4 percent). Youth's greatest Tosses were in TCU, FIRE, and business services (51.1 percent of their Tosses combined), while their greatest gains were in retailing (a staggering 80.6 percent). The patterns of gains and losses among Hispanic females tendecl, with some discrepancies, to resemble those of black fe- males. Among black males and Hispanic mates, there were limited positive shifts, overwhelmingly concentrated in some of the least- dynamic and sIowest-growing sectors of the economy: manufactur- ing and TCU for black males (+71.4 percent), and manufacturing and construction for Hispanic males (+92.8 percent). Lastly, the key finding for white women remains that industry shifts over the decade were very limited, with an overall turnover of only 2.6 percent. The second set of data, presented in Table 2, shows changes in the normalized shares of five demographic groups of workers in major occupations between 1966, 1978, and 1981. These data are for large private-sector firms only (100 or more employees) and are based on EEO-1 reports, which large employers must file every year. They show the progress made by various groups of workers in what has been traditionally the most progressive sector of the economy in terms of EEO enforcement—that of large employers.
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THIERRY J. NOYELLE 379 Some major changes are worth highlighting. The data show white women advancing out of clerical positions and making large gains in professional ranks; black women and Hispanic women, respectively, moving out of service worker and laborer positions while, in both cases, gaining in clerical positions; and black men and Hispanic men shifting out of laborer positions and into oper- ative and craft positions. Despite some scattered gains, minority males in general continue to trail considerably in the fast-growing white-collar occupations. Of all groups, Hispanic males appear to be the least mobile. Together these two data sets suggest the following: (1) a relative narrowing of job opportunities for youth as their concen- tration in retailing increased; (2) a relative improvement in the position of women as shown by the gains of minority women into clerical positions and the advances of white women into profes- sional positions; and (3) a general lack of progress by minority men in entering the relatively fast-growing service industries and white-colIar occupations. Findings regarding age-based discrimination are incomplete. Aside from the patterns observed among youth, the statistical analysis developed for this paper appeared too crude to yield sig- nificant evidence of age-based discrimination among other groups, although it is thought to exist. THE TRANSFORMATION OF THE AMERICAN ECONOMY AND CHANGES IN THE DEMAND FOR LABOR THE RISE OF THE NEW SERVICE ECONOMY AND ITS IMPACT ON THE INDUSTRY-OCCUPATION STRUCTURE For some time now, the U.S. economy has been in the midst of a major transformation, involving the shift of capital and labor out of the smokestack industries and into high-tech and service industries. While this transformation had been in the making through much of the early postwar period, the acceleration in the internationalization of the economy after the first oil crisis of 1973 contributed to speeding the redeployment of resources, as many older industries were put through the wrenching test of worldwide competition (Noyelle, 1984; Stanback and Noyelle, 1982; Stanback et al., 1981; Ginzberg and Vojta, 1981~.
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THIERRY J. NOYELLE 381 Between 1970 and the last quarter of 1984, 27.2 million net new jobs (Employment and Earnings, household survey data) were added to the economy, of which nearly 95 percent were in the ser- vice industries. Looking at the Reagan years only, the shift to services was even sharper since, by November 1984, employment in the goods-producing industries- agriculture, mining, construc- tion, and manufacturing" had not even caught up with their Jan- uary 1981 level (Employment and Earnings, establishment survey data). In net terms, this means that employment growth, since early 1981, had been 100 percent in the services. In occupational terms, the labor market transformation of the 1970s has led to more than 7 out of every 10 workers being em- ployed in either white-collar or service-worker occupations. Simul- taneously, a very sharp drop in the share of blue-collar workers- from 39.2 percent to 29.3 percent of the nonagricultural labor force occurred between 1965 and 1983 (Employment and Earn- ings, household survey data). In short, growth has shifted to service industries dominated by white-colIar or service-worker oc- cupations, technological change in manufacturing accelerated the shift to managerial, engineering, technical, sales, and clerical oc- cupations, away from blue-collar jobs. As Tables ~ and 2 indicate, these shifts have been tilted toward women and minority workers. During the 1970-1984 period, nearly two-thirds of the new jobs were filled by members of these groups. By late 1984, white males, for the first time, no longer constituted the majority of the labor force: their share of the employed had dropped from nearly 55 percent in 1970 to 49.5 percent by late 1984. THE EARLY YEARS OF EEO: OPENING INTERNAL LABOR MARKETS TO WOMEN AND MINORITY WORKERS The aforementioned statistics mean little until one analyzes who gets hired, for which jobs, and through which mechanisms. Looking back at the record of the postwar period, it is surprising to see the extent to which employers used to rely on internal labor market structures to train workers and staff the ranks of their orga- nization, and how rapidly this practice began changing in the early 1970s (Edwards, 1979; Osterman, 1982a, 1982b; Noyelle, 1986~. It is important to stress that this earlier reliance on "internal la- bor markets" was extensive not only among- the manufacturing
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382 EQUAL EMPLOYMENT OPPORTUNITY giants that typified the era—the IBMs and the GMs but also among many medium-sized firms, including those in the service sectors (Appelbaum, 1984; Noyelle, 1986~. Thus, the recent loos- ening of the reliance on internal labor markets cannot solely be ascribed to the overall industry shift to the services, but must be seen as part of a total labor market transformation affecting both manufacturing and service industries. In the insurance industry, for example, most workers entered firms straight out of high school, at the very bottom of the orga- nization as messengers or file clerks. Through on-thejob training and seniority, they would move up the ranks. For example, the most successful would move gradually from an entry-level cleri- cal into a professional position, from, say, messenger to statistical clerk, claims examiner, or policy rater and later to assistant un- derwriter or underwriter (Appelbaum, 1984; Noyelle, 1986~. In the department store industry, workers wouh] enter as stockroom clerks and would move into sales positions (possibly to a commis- sioned sales position in a high-ticket department such as furniture, household, appliances, etc.), or even to department manager, as- sistant buyer, and buyer positions (Noyelle, 1986~. There were important (differences among industries and firms, however. In the construction sector, for example, mobility ladders were industry and craft based rather than firm based, with trade unions often playing a central role in operating the mobility sys- tem (Gallo, 1983~. In addition, most small firms lacked both the resources and the range of employment opportunities necessary to operate internal labor markets and relied extensively on the open labor market. More important, perhaps, sex and race stereo- typing was often used to create sex- or race-labeled occupations. In turn, these were used to restrict mobility opportunities avail- able through internal labor markets to white males, by channeling women and minority workers into dead-end jobs. A good deal of the mid-1970s literature on internal labor markets sought to ac- count for many of these differences and the way they contributed to discrimination among different groups of workers. Consistent with the dynamics of labor markets prevailing at the time, a principal focus of EEO policy, when first formulated, was to open internal labor markets through both hiring quotas and internal quotas to those who, for reasons of race or sex, had been left out or left behind. Much attention was focused on industries that were then the pillars of the economy: manufacturing and the
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THIERRY J. NOYELLE 383 public sector. The efforts of the federal government to accelerate the promotion of minorities and women withm its own agencies, as well as within the private sector, through major consent decrees such as those secured in 1973 between AT&T and the Equal Em- ployment Opportunity Commission (Northrup end Larson, 1979), and in 1974 between the Commission and the steel industry (Ich- nowski, 1983), typified that period of EEO enforcement. Although these decrees led to substantial gains during the 1970s, in retrospect, we can see that these efforts were focused on industries and work settings that were declining in economic im- portance. We are left with only limited clues as to how to approach and solve labor market discrunination in today's economy. Over the past decade, the role of internal labor markets has weakened dramatically across a broad range of industries. The reasons for this declining role are numerous and diverse, but it is evident that firms are increasingly externalizing the cost and responsibility for the training process, are relying more and more on external labor markets for new workers, and are putting in place new arrange- ments affecting whom they hire and promote (Noyelle, 1986~. Two primary forces ace responsible for this new dynamic: the postwar expansion of schooling and higher education and the new wave of technological change. THE POSTWAR EXPANSION OF SCHOOLING AND HIGHER EDUCATION AND ITS IMPACT ON HIRING REQUIREMENTS AND MOBILITY LADDERS The first factor behind the transformation in hiring and mobil- ity opportunities the postwar expansion of schooling and higher education- albeit slow In the making, is nevertheless irreversible. The transformation has been largely a case of supply changes leading to demand changes. By changing the makeup of the labor supply, the expansion of the educational system put pressure on all firms to adjust their hiring procedures to the new availabilities of a labor supply increasingly differentiated by grades and types of education. For example, whereas only slightly more than 10 percent of those between age 25 and 29 had received 4 or more years of college education in 1960, by 1980 their share had risen to nearly 25 percent. The expansion of formal education led to a major shift to outside hiring, first felt most strongly at the level of professional
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384 EQUAL EMPLOYMENT OPPORTUNITY and managerial personnel the so-called "exempt workers. This trend significantly weakened some traditional internal ladders, es- pecially those designed to move the ablest workers from nonex- empt positions into supervisory and middle managerial positions. No longer could a sales clerk expect to become a buyer for a major retail organization, or a messenger expect to become an insur- ance executive by simply moving through the ranks. Rather, most companies began recruiting exempt workers directly from college (Noyelle, 1986~. In that respect, the 1970s represent a turning point as the cumulative effect of several decades of expansion of the educational systems and the coming of age of the baby boom were felt massively on the supply side of the labor market. THE IMPACT OF THE NEW TECHNOLOGY ON SKILL REQUIREMENTS AND THE ACCELERATION OF CHANGES IN HIRING AND MOBILITY OPPORTUNITIES Whereas earlier changes in hiring and mobility opportunities had been mostly supply driven, recent changes have been largely demand driven. They are the result of the introduction of the new computer-communications technology and its impact on skills. Broadly speaking, the new technology has acted to reinforce the tendency toward a weakening of internal ladders. Two preliminary observations are warranted to support this point. First, vast areas of work are being transformed and reor- ganized around the processing of information through interaction with computerized systems. Until recently, the areas most directly affected had tended to be primarily in the middle range of occupa- tions, from relatively low-level clerical positions or even blue-collar operative positions, all the way up to low- or middle-level profes- sional workers (Hirschhorn, 1984; Bertrand and Noyelle, 1984; Appelbaum, 1984~. Today, however, higher-level technical, profes- sional, and/or managerial work are also being unaffected. Only in the case of the lowest-level occupations primarily laborers, ser- vice workers, and low-level sales and clerical classifications has the new technology, thus far, had little or no direct impact on work and skills. It may be relevant to note here that these low-skilled occupations, including sales clerks, building janitors, guards, or- derlies, cooks, and others have been among the fastest-growing areas of employment and that mobility ladders are conspicuously absent in these occupations (Bureau of Labor Statistics, 1984~.
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THIERRY J. NOYELLE 385 Second, the new technology does not, as many initially be- lieved, lead ineluctably to downskilling but rather to varying degrees of upskilling. This generalization does not preclude oc- casional downskilling or occasional lags between current and po- tential uses of technology by firms. Upskilling comes about for three principal reasons: first, because the most efficient use of the new technology often seems to lead to a reintegration of tasks pre- viously parcelled out among difl.erent workers; second, because, as intelligent systems take over Processing functions, workers are left with "diagnosis and ~problem-solv~ng~ functions; and third, because the shift to "problem-solving" functions at lower levels of the organization calls for a simultaneous decentralization in decision-making power (Adler, 1984; Hirschhorn, 1984; Rajan, 1984; and others reviewed in Bertrand and Noyelle, 1984~. As the new technology changes skill requirements for many jobs, it also leads to the homogenization of skills across a wide range of industries, encouraging the externalization of training for many m~le-leve} workers. This means that the jobs of bank clerks processing letters of credit or fund transfers on a comput- erized system, of insurance examiners processing claims, of airline agents processing reservations and ticketing, or even of telephone switchmen routing and managing traffic flows through switches are becoming not only more demanding in terms of skills, but also increasingly similar in terms of skills required (Appelbaum, 1984; Noyelle, 1984~. Not surprisingly, a major focus of the current "training debate" about the need for more sophisticated training institutions concerns this middle range of occupations, because these are occupations, that, in their older configurations, had rarely been brought within the purview of formalized training pro- cesses. These were jobs for which skill training was traditionally acquired on the job through internal labor market mechanisms. Hirschhorn (1984) refers to this transformation as the process of ~para-professionalization." Thus, the institutions most directly concerned with the new demand for training are clearly not simply high schools but, increasingly, vocational-educational institutions, community colleges and even 4-year colleges.
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386 EQUAL EMPLOYMENT OPPORTUNITY TECHNOLOGICAL CHANGE AND INCREASING INSTITUTIONAL AND GEOGRAPHICAL MOBILITY Since formal education and training have become increasingly important in determining a worker's position in the labor market, there is a presumption that better-prepared workers should have an edge particularly in terms of improving their earnings. Thus far, this has not necessarily been the case. The tendency toward universalization/homogenization of skins has also weakened the degree to which workers are sheltered from competition as they once were when skins were more specific to the output of the industry or firm. Further, this has been aggravated by a context of weakening unionization. In addition, the new technology makes it increasingly feasible and cost efficient to separate geographically so-called back-office functions (dominated by clerical and service worker occupations) from Front-office functions (dorn~nated by technical, sates, pro- fessional, or managerial occupations). Two consequences follow. First, the separation contributes to breaking the institutional job linkages that used to exist when entire departments, from the bot- tom up, were located in the same physical location. Second, the increasing mobility of back-office establishments puts workers on the defensive because the rise in two-wage-earner households is hindering geographic mobility for many. THE SHIFTING NATURE OF DISCRIMINATION The broad changes that have taken place on the demand side of the labor market and the gains made by certain groups of workers in selected occupations and industries as a result of early EEO efforts have both acted to shift the nature of discrimination. Two examples will serve to illustrate some aspects of the shift: (~) baclr-office clerical employment and (2) sales employment in the retailing sector. In the first example, technology is brought in to reform, reorganize, and rationalize work involving large con- centrations of workers. As suggested above, the introduction of technology has led to some degree of upskilling and associated changes in the demand for labor. In the second case, the direct impact of technology on sales and related occupations is relatively modest. Technology figures in mostly indirectly in that it permits
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THIERRY J. NOYELLE 387 great improvements In the control and coordination of the orga- nization itself (in buying, inventory control, and accounting). To the extent that changes in labor demand can be observed, these are unlikely to be associated directly with technology. These two examples are instructive because they cover work situations in which large numbers of women and minority workers have traditionally found and continue to find employment. THE REORGANIZATION OF BACK-OFFICE EMPLOYMENT This example relates to the reorganization of clerical work typical of the back offices of banks, insurance companies, telephone . and other utilities, and other organizations with large processing facilities. In the 1960s and early 1970s, these firms hired large numbers of youth as messengers and file clerks directly out of high school to staff entry-level clerical positions. Later, many of these young workers would be trained in-house and would move up the ladder as they matured. As Appelbaum (1984) has noted, the long-standing tendency in back offices was to discriminate between white men and women and minority workers by operating a two-track system. One track, reserved mostly for white men, lead those workers into professional or managerial employment; the other, used primarily for women and minority workers, would channel most of them into dead-end positions. By forcing companies to do away with these practices, EEO, for a time at least, opened new avenues of opportunities to women and minority workers. Yet, no sooner had these av- enues been opened than their access was considerably curtailed as the result of the tendency toward the weakening of internal labor markets, and in particular the delinking of nonexempt from exempt jobs. This did not completely shut out access for women and rn~norities to many managerial and professional positions; but, typically, it forced them to enter through another route, that of higher education. At the same time, changes were also occurring at the traditional entry level, with impacts on both adult workers and youth. For many years companies with large back-office employment were known for their close links to the local high schools. Dur- ing the 1970s, however, this situation changed dramatically as a result of the new technology. As one executive of a large New York insurance firm reported in a recent interview: "Up until the
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388 EQUAL EMPLOYMENT OPPORTUNITY early 1970s, we hired nearly 2,000 kids every summer. Today, we hire at most 100 kids. Nowadays, most entry takes place at a higher level typically community college or equivalent straight into citron examiner positions. Most of the filing and messenger functions have been eliminated through computerization." In a recent study of the youth labor market in New York City, Bailey and Waldinger (1984) found that of the nearly 40,000 jobs lost by youth in New York City during the last decade (197~ 1980), nearly half could be attributed to the sheer contraction of the city's economy. The other half—that is nearly 20,000 jobs- could be attributed to the elimination of filing clerks, messengers, and similar positions in local public utilities (telephone, gas, and electric), banks, and insurance firms. The industry shift data for youth presented above corroborate this finding for the nation as a whole. Beyond the magnitude of the numbers involved, these losses implied that by the late 1970s a major group of workers—youth with high school or equivalent diplomas no longer had available to them entry opportunities with built-m promotion ladders. They had largely been relegated to entering retail and consumer services, with far more limited opportunities for upward mobility. The trend just discussed, which was set in motion in the early 1970s when large back-office organizations began investing in cen- tralized EDP, Is being followed by yet another trend growing out of the deployment of distributed data processing in the late 1970s and early l980s. The new generation of computer-communications technology permits geographic separation of back offices from front offices of the firm and permits the parent organization to seek new locations away from the central districts of very large cities such as New York, Los Angeles, Chicago, Philadelphia, and other places where back-office jobs have traditionally been located. The great- est impact of this new trend appears to fall on minority women, who had made great gains in entering clerical ranks during the 1970s but who may now be left behind in the inner cities where they reside, while back-office jobs are being moved elsewhere (Noyelle, 1986, especially Ch. 5~. While some groups are losing, others are clearly gaining from this restructuring/relocation of back-office work. In general, em- ployers relocate their facilities not only in areas where operating costs (rent, utilities) and labor costs are lower, but also often in areas where they can find an infrastructure of community colleges (or equivalent) that will help them prepare and train employees.
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THIERRY J. NO YELLE 389 Typically, such moves bring firms to the suburbs where they seek large pools of middle-aged, married, usually white women. In some cases, they bring employers to communities with large military in- stallations where they hire both married wives of enlisted men and retired military clerks willing to put in a few more years of work. The advantage of hiring from these groups is that these are workers who typically demand little by way of mobility opportu- nities, something that most employers can no longer offer because of delinking between back-office clerical positions and higher-level jobs. THE TRANsFoRMAT~oN OF RETAIL EMP~oYMENT Retail is one sector where employment transformations appear to be less directly linked to recent or past technological changes. This does not mean, however, that the new technology has not found its way into this sector, but that its impact has been more diffuse and indirect. The postwar period witnessed the rapid growth and diffusion of large chain organizations. Up until the 1940s, organizations such as Sears or A&P were exceptions. The postwar period saw a rapid growth of multiunit organizations in foods, dry goods, hardware, gasoline, and many other areas, penetrating markets traditionally dominated by ~mom-and-pop" businesses. The resulting shift in the scale of operations made possible substantial rationalization, with accompanying major productivity gains in buying, inven- tory control, and accounting, facilitating the further growth of large sales organizations with relatively thin administrative staffs. These changes also made it easier for large retail organizations to follow their customers into the suburbs, where they were able to tap into underutilized pools of suburban married women often eager to work. Simultaneously, the cumulative effect of changes in work hab- its and spending patterns (e.g., two-worker families) led retail organizations to stay open for more hours during the week and to make more use of part-time employees. In place of the basic 9-to-5, Manhour work week, many retail organizations, today, are open 65 hours a week (10 hours on weekdays; 7.5 hours on Saturday and Sunday). In some of the largest metropolitan areas, supermarkets compete on a 24-hour, 7 days-a-week basis. The impact of these changes on employment patterns has been dramatic: the reliance
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390 EQUAL EMPlOYMENT OPPORTUNITY on part-time employees has skyrocketed. In department stores, the breakdown between fur-time and part-time employment shifted from 65 percent full time/35 percent part time in the mid-1960s to the reverse ratio nowadays as stores added half-time and short- hour shifts (Noyelle, 1986~. Much of the employment expansion in retail was first based on the hiring of women first white women, later minority women. Clearly, the expansion of part-time jobs was aimed in part at facilitating the employment of married women, many of whom preferred not to put in a full work week. While large retail or- ganizations were leaders in uncovering those underutilized pools of women, the discovery did not go unnoticed for long in other industries. As noted previously, large clerical organizations are now actively seeking such employable women by relocating back- office facilities in the suburban rings of large cities. In the process, these organizations are creating new pressures on the adult women labor market. As a result, many retail organizations are now seek- ing to recruit more actively from among high school youth, many of whom are now available, because, short of educational creden- tials higher than a high school diploma, they are blocked from competing for more desirable jobs. POLICY IMPLICATIONS For more than 20 years now, this nation has had a policy of equal employment opportunity enacted into law, administered by a specialized federal agency, and enforced through the courts. Because EEO was shaped under specific historical circum- stances, namely, as an outgrowth of the civil rights and, later, women's movements, and because it was shaped in response to the reality of the labor markets of the 1960s and early 1970s, the prin- cipal emphasis of early EEO policy was to stress the elimination of sex-based or race-based discrimination in the workplace. Work- place discrimination, at the time, was primarily rooted in blatant sex or race job stereotyping, perpetuated not simply through cul- tural biases but quite concretely by excluding women and minority workers from entering white men's jobs and from accessing oppor- tunity ladders available to white men. In a period when the large majority of workers was rarely educated beyond high school, for- mal education beyond the acquisition of basic skills was seen as playing a relatively minor role in determining what happened to
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THIERRY J. NOYELLE 391 workers once they entered the labor market. Still, considerable effort was also placed on desegregating schools to increase the like- lihood that minority youth would acquire basic skills and be able to enter the labor market on the same terms as white youths. To assert that sex or race discrimination in the workplace has been eliminated and no longer needs the nation's attention would be ridiculous and wrong. But it would be equally wrong to write off the past 20 years of EEO enforcement and assert that nothing has changed. This paper suggests that we need (1) a stronger assessment of the changes that have occurred in the labor market as a result of earlier EEO efforts, the increasing importance of education, technological change, and the structural shift from manufacturing to services; (2) a stronger assessment of the impact of these changes and their role in bringing to the fore factors of discrimination other than sex or race, especially age and socioeconomic status; and (3) a stronger assessment of the way in which these new factors of discrimination may be used either independently or in connection with sexual or racial characteristics to bring about different patterns of discrimination. Formal education is clearly becoming a major determinant of a worker's long-term position in the labor market. This is not simply a case of growing credentialism for the sake of erecting new barri- ers, although the tendency may also be at work. While professions have traditionally used formal accreditation or licensing based on educational degrees as a way to keep entry restricted, the rising importance of education is also a reflection of a growing reliance on externalization of training. This tendency has been in the making for several decades, especially among the upper echelons of the oc- cupational structure. Still, the new technology is intensifying the trend, by accelerating the formalization of training and education for workers employed in a broad range of m~ddle-level occupations. The increasing importance of education appears to be creating both new opportunities and potential problems for groups of work- ers that have traditionally been the target of discrimination. On the one hand, the process of externalization of training may make it increasingly difficult for employers to close off access to skill acquisition as a way to discriminate against women and minority workers. The substantial progress of women over the past two decades in professional occupations attests to this. On the other
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392 EQUAL EMPLOYMENT OPPORTUNITY hand, the externalization of training is unlikely to be problem- free. For example, the current structure of our higher educational system—characterized by considerable disjunction among various levels (2-year colleges, 4-year colleges, graduate schools) and often lacking flexibility- makes it difficult to find workable continuing- education solutions that are increasingly necessary in order to progress upward in the labor market during one's work life. In addition, to the extent that employers may partly control access to higher education, for example, by financing retraining programs at the community college level or tuition reimbursement programs at 4-year colleges, there may be room for discrunination to creep back in. In general, these developments point to the increasing im- portance of the issue of who gets access to preferred education and why. In a society that is still far from having an equitable educational system in place, one's family socioeconomic status may largely determine one's future position In the labor mar- ket. It has been primarily m~dle-class women, mostly although not exclusively white, who, over the past two decades, have been most successful in advancing to professional positions through the higher educational route. Short of major changes, this trend may accelerate. In concluding, three points must be emphasized. First, ~ believe that EEO's traditional emphasis on eliminating cultural biases and institutional arrangements that perpetuate discrim~na- tion in the workplace must be maintained. But ~ also believe that EEO policy must begin to reach outside the employing institu- tion to the educational process in order, ultimately, to strengthen enforcement in the workplace. As noted at the outset, this may require new legislation to bring about a more coordinated enforce- ment effort in the two areas. Second, the linkage between work achievement, education, and socioeconomic background may have major implications for women And minority groups that have traditionally used "sex" or "racer as a lever in the workplace. Increasingly, sex or racial groups may become differentiated along socioeconomic class lines, so that recourse to "sex" or "race" as rallying points in the workplace may lose some strength. Finally, as the aggregate data indicate, we may need to put in place special efforts to assist minority men who appear to be failing in entering many of the white-collar occupations in the
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THIERRY J. NOYELLE 393 service sector where much of the future lies. The unrelenting high unemployment among young minority workers must be a matter of special concern. We must find ways to intervene and turn this trend around. REFERENCES Adler, P. 1984 Rethinking the Skill Requirements of New Technologies. Working Paper HBS 84-27, Harvard Business School, Division of Research, Cambridge, Mass. Appelbaum, E. 1984 The Impact of Technology on Skill Requirements and Occupational Structure in the Insurance Industry, 1960~1990. Working Paper. Temple University, Department of Economics, Philadelphia. April. Bailey, T., and R. Waldinger 1984 A skill mismatch in New York labor market? New York Affairs (Fall):3-18. Bertrand, O., and T.J. Noyelle 1984 Development and Utilization of Human Resources in the Context of Technological Change and Industrial Restructuring: The Case of White Collar Workers. Expert Report, Organization for Economic Cooperation and Development, Center for Educational Research and Innovation, Paris, OECD/CERI/CD(85/8~. Bureau of the Census 1974 Ccr~w of Population: f9970. Detailed Characteristics. Report PD(1)D. Washington, D.C.: U.S. Department of Commerce. 1984 Ccn~w of Population. 1980. Detailed Charactcri~tice. Report PC80-1- D. Washington, D.C.: U.S. Department of Commerce. Bureau of Labor Statistics Var. Employment and Earning. Washington, D.C.: U.S. Department of years Labor. 1984 1995 Ind~try-Occupational Employment Outlook. Washington, D.C.: U.S. Department of Labor. Edwards, R. 1979 Contested Terrain. New York: Basic Books. Gallo, C. 1983 The Construction Industry in New York City: Immigrants and Black Entrepreneurs. Working Paper. Conservation of Human Resources, Columbia University, New York. Ginzberg, E., and G. Voita 1981 The service sector of the U.S. economy. Scientific American 244 (March):48-55. ma_ r~_A. It; At Rick. New York: Basic Books. 1985 ~ It Day— TV uneven Hirschhorn, L. 1984 Information Technology and the Office Worker: A Developmen- tal View. Working Paper. Management and Behavioral Center, University of Pennsylvania, Wharton School, Philadelphia.
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1 394 EQUAL EMPLOYMENT OPPORTUNITY Ichnowski, C. 1983 Have angels done more? The steel industry consent decree. Indw- trial and Labor Relations Review 36~2~:181-198. Northrup, H.R., and J.A. Larson 1979 The Impact of the AT8T-EEO Corpulent Decree, Vol. #20. Labor Relations and Public Policy Series, University of Pennsylvania, Wharton School, Industrial Research Unit, Philadelphia. Noyelle, T.J. 1984 Work in a World of High Technology: Employment Problems and Mobility Prospects for Disadvantaged Workers. Paper prepared for the Educational Resources Information Center, U.S. Department of Education and the University of Tennessee, Oflice for Research in High Technology Education, Knoxville. 1986 Beyond Industrial Dualism: Market and Job Segmentation in the New Economy. Boulder, Colo.: Westview Press. 1987 Technological Change and Employment in the Financial Service Indw- tries. Conservation of Human Resources, Columbia University, New York. Osterman, P. 1982a Internal Labor Markets in White Collar Firms. Working Papers #90. Boston University, Department of Economics. 1982b Employment structures within firms. British Journal of Industrial Relations 20~3~:349-361. Raj an, A. 1984 New Technology and Employmerd in Indurated, Banking and Building Sociehes: Recent E - erienec and Future Impact. Cower and Aldershot, U.K.: Institute of Manpower. Stanback, T.M., Jr., and T.J. Noyelle 1982 clitics in Ihnsstior~ Totowa, N.J.: Rowman and Allanheld. Stanback, T.M., Jr., P.J. Bearse, T.J. Noyelle, and R. Karasek 1981 Seruicc`/Thc New Economy. Totowa, N.J.: Rowman and Allanheld. U.S. Equal Employment Opportunity Commission 1966 EGO-] Report on Minorities and Women in Private Industry. Washing- 1978 ton, D.C.: U.S. Equal Employment Opportunity Commission. 1981 )
Representative terms from entire chapter: