Off the Books

The benefits of free enterprise that economic statistics miss

W. Michael Cox & Richard Alm from the August/September 2002 issue

(Page 2 of 4)

The explosion of leisure spending and activities confirms the addition of more free time to our lives. If we hadn't reduced our hours of work, we couldn't spend as much time and money as we do on entertainment and recreation. Americans may find themselves pressed for time, but it's not because we're working harder than we used to. We're busy having fun.

Better Work Too

As the Industrial Revolution arrived in the 19th century, workers migrated from family farms to factories, from the Old World to the New World. They saw their paychecks rise but became, like Charlie Chaplin's character in Modern Times, mere cogs in a vast engine of mass production. Work was often brutal. Early factories were noisy, smelly, and dirty; they were cold in the winter and hot in the summer. The labor itself was repetitive, physically exhausting, and often dangerous. It was a time of mind-numbing repetition, standing on assembly lines, nose to the conveyor belt. To eke out a meager living, employees toiled an average of 10 hours a day, Monday through Friday, plus another half-day on the weekend. Breaks were few and far between. Work rules were draconian: no talking, no eating or drinking, not a minute late punching the time clock.

We've come a long way since then. For the most part, modern work takes place in a clean, well-lit, and air conditioned environment. A growing number of modern workplaces offer on-the-job amenities previous generations didn't even contemplate, such as on-site day care for children, exercise facilities, and concierge services. More and more employees are getting paternity leave, stock options, personal days off, and paid sabbaticals.

Jeans, sport shirts, and slacks are in. Ties and pantyhose are out. A July 2000 survey by the catalog retailer Land's End found that dress had become more casual in the previous five years at more than 80 percent of Fortune 500 firms.

More Americans than ever are free to choose the time and place for work, as long as the job gets done. In 1997, 28 percent of American workers were on flexible schedules, double the percentage in 1985. With laptop computers, cell phones, fax machines, electronic mail, and the Internet, fewer employees are tethered to the office. Telecommuting began with a handful of workers three decades ago. By 2001, 29 million Americans worked at least part of the time away from their companies' places of business.

Work isn't just more pleasant. It's also safer. Occupational injuries and illnesses, as tallied by the National Safety Council, are at an all-time low of 63 per 1,000 workers. The number of Americans killed on the job has fallen to a record low of 38 per million workers, down from 87 in 1990 and 214 in 1960.

Safer workplaces come in part from fewer accidents in such dangerous occupations as construction and manufacturing. At the same time, our economic base is shifting toward services, where jobs are less risky. The nature of the work we do is changing too. For most Americans in past generations, long days on the job involved tasks that were repetitive, physically exhausting, and often dangerous. Modern work is more likely to require analytical and interpersonal skills. Fewer employees make their livings with their backs and hands.

Jobs Rated Almanac 2001 provides a handy database of 300 occupations, ranked from best to worst. To focus on working conditions rather than pay, wages are taken out of the equation. Once that's done, it's clear our employment base is shifting in a positive direction. Since 1970 the 30 best jobs -- including computer scientist, legal assistant, and engineer -- have risen from 9 percent to 13 percent of total employment. At the same time, the 30 worst occupations -- from logger to textile mill worker -- have declined from 13 percent to 9 percent of all jobs. The trend toward better jobs is likely to continue. The Bureau of Labor Statistics estimates that the 10 best jobs will grow by 27 percent through 2008, while the 30 worst jobs will expand by just 7 percent.

Making workplaces more pleasant takes money. The added expense figures, along with wages, into the overall bill for labor. Companies pay it to attract new workers and retain those already on board. Employers shouldn't care whether the money goes for wages, time off, or working conditions. By their decisions on where to work, employees reveal their preferences.

Safer Lives

Although concerns about security have come to the fore since September 11, we shouldn't forget how far the United States has already come in making life safer. The toll of death and disease has been steadily reduced. Annual deaths per 1 million people are at an all-time low. The age-adjusted death rate has fallen by two-thirds since 1900. Fatalities from nearly all major diseases, tracked by the U.S. Centers for Disease Control and Prevention, have declined sharply from their peak rates. The rate of fatalities per 100,000 due to natural causes has fallen from 767 in 1950 to 422 in 1998, the most recent year for which data are available. The incidence of accidental deaths, both at home and on the job, is declining. So are fatalities associated with floods, tornadoes, and hurricanes.

Gains in transportation safety have been dramatic. In the five-year period ending in 2000, according to the Federal Highway Administration, annual deaths on American roads averaged 16 per billion miles driven, compared with 53 in the five years ending in 1970 and 83 for the post�World War II years. The Air Transportation Association reports that deaths per billion passenger miles flown fell from 16.7 a year in 1946�50 to 1.3 in 1966�70 to 0.14 in 1996�2000.

As a wealthy nation, we can afford to spend time and money to reduce life's risks. We can buy alarms for our homes and cars. We can buy insurance on our property and our lives. We can reduce the financial risks of illness and old age by taking part of our pay in health benefits and retirement savings.

We can also shift resources to the military to create an even more fearsome fighting force. During World War II, defense spending per capita averaged $3,475 a year in today's dollars, or 29 percent of total output. Today, each American's share of the defense budget comes to $1,079, just 3 percent of GDP.