Study Shows New Economy Puts Dual-Income Couples In Double Jeopardy

ITHACA, NY — “Nine in ten dual-income couples in New York State feel there is some risk that one or both of their jobs might not exist in the next couple of years,” says Ithaca College sociologist Stephen Sweet, lead author of the study “Dual Earners in Double Jeopardy: Preparing for Job Loss in the New Risk Economy.”

“In the old economy we largely depended on the male bread winner. The wife was a homemaker and the men were much more likely to have jobs that were secure; this is especially true for white middle-class families where job security increased with seniority. And, in the old economy if the husband lost a job the wife was reserve labor and she could go out into the labor force and make ends meet. Whereas to maintain a middle-class lifestyle in today’s economy, dual-income couples are the norm to make ends meet.”

In the study published in “Research in the Sociology of Work,” Sweet examines the changes in structures and protections in the new economy, illustrating how the new economy dismantles the systems that made workers more confident they would hold their jobs as they aged and their family investments increased. The loss of protections under the old economy has created a dramatic increase in two-income families.

“In the new, dual-income economy, the loss of one person’s job can put the family at financial risk in a matter of months.  Then for that family to make adjustments often requires both partners to make career moves. So one partner has to look in a limited job market to find out that those jobs aren’t there, especially if they hold specialized skills, then they may have to move to another location, which requires the trailing spouse to leave his or her position. So the logistics of managing insecure careers is compounded in dual earning arrangements.  We call this the ‘Double Jeopardy of Risk,’ in that one person’s job loss puts both careers at risk.

“Most working middle class families have next to no savings and the savings they do have are often in things they can’t touch, like their 401(k). They are often in debt — credit card debt, mortgage debt — so they are living paycheck to paycheck.” 

Sweet further noted that in the old economy there was higher level of security; there was also the option for reserve labor. One in four workers was in a union job and if there was displacement there would be some benefits coming from the union.  When workers are displaced now most of them don’t receive any severance pay; those who do receive severance find it is a minimal amount of a couple of week’s compensation.

In the study Sweet also examined the inadequacy of today’s organizational and government policies, noting that three key programs in the minimalist U.S. safety net are in need of serious reform: unemployment insurance, social security and health care insurance.

“Our current system of unemployment assumes that most jobs can be replaced in a fairly short time and that most jobs are stable. Lacking protection are workers with short tenure, temporary workers, agricultural workers, part-time workers, those who left jobs voluntarily to follow a partner’s career and those who have been out of the labor force but are seeking to return.

“We need to go beyond insurance (designed to protect people from unlikely events), to more innovative means of supporting working families as they need, or are forced, to take time out from the labor force. We also need to increase the portability of benefits packages and separate access to health insurance from jobs.”

Social security, Sweet noted, is based on the premise that one’s highest earnings come right before retirement.  In the current job market this is no longer true, and health insurance is tied to getting and keeping full-time work.

Findings in the study indicate that today fewer people can say with any degree of certainty where their careers are headed in the next week, next month or next year. Couples have difficulty finding the time to plan their careers particularly since the new economy binds job security more closely with working longer hours. In a climate where jobs are insecure and geographically scattered couples face remarkable challenges when trying to construct stable careers and family lives.

"I think the story here is that risk is traveling and the impact on families can be profound,” said Sweet.

Originally published in News Releases: Study Shows New Economy Puts Dual-Income Couples In Double Jeopardy.

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