March 7, 2007: Features


Workplace success stories

Katherine S. Newman

(Illustration: Jean-François Martin; Photo: David Hunsinger)

Work and spending: What really matters

Two professors — one in sociology, one in psychology — explore what drives the economic decisions and upward mobility of the poor

By Katherine Levy Feldman ’78

Workplace success stories in unexpected places

Sociology professor Katherine S. Newman prides herself on, as she puts it, “swimming against the current.” In the 1980s she researched downward mobility, a topic few had investigated since the Great Depression. The downward trend was always there for some people, she explains, “but no one was paying attention.”

Newman, who arrived at Princeton three years ago as the Malcolm Stevenson Forbes ’41 Professor of Sociology and Public Affairs, always has paid attention. Her interests lie in the study of social stratification, with a special emphasis on the meaning of mobility, work, poverty, and violence in American culture. She’s passionate about her topics, in part because they are rooted in her own experiences: When she was 14, a major downturn in California’s aerospace industry left her father unemployed, and he never worked again in a professional capacity. The family lost its home; Newman’s mother took a series of poorly paid positions; and Newman worked at odd jobs during her years as a student at the University of California, San Diego.

At 53, Newman — an anthropologist by training who has taught at Columbia, Berkeley, and Harvard — is a prolific and prize-winning author. She calls herself a “public scholar” and works hard to address audiences within and outside the academy, often speaking on radio and television. Her most recent work, Chutes and Ladders: Navigating the Low-Wage Labor Market, was released in October. The New York Times Book Review called it a “valuable ... collection of carefully drawn portraits of people who got their start working at the bottom rung of the American economy.” Chutes and Ladders is a follow-up to the study Newman and her team of doctoral students began in 1993 and first documented in the book There’s No Shame in My Game, which in 2000 won the Robert F. Kennedy Book Award and the Sidney Hillman Foundation Prize for writers who pursue social justice and public policy for the common good.

There’s No Shame in My Game, Newman’s initial exploration of the daily struggles and triumphs of low-wage workers, was based on interviews with 200 workers in minimum-wage fast-food jobs in Harlem and 100 job-seekers who had been turned down for similar jobs in 1994. It punctures the myth of the unmotivated working poor, offering personal accounts of the daily lives of those struggling to make ends meet. Chutes and Ladders revisits these workers to see how they fared in the prosperity of the 1990s, when America’s worst-paid workers saw wages rise ahead of prices for the first time in decades. What did these historic trends mean for the working poor? Why were some workers who had little going for them in the mid-’90s able to climb the ladder of success, becoming what Newman dubs “high flyers,” while others moved in the opposite direction or stayed stagnant?

Once again Newman’s findings, which she acknowledges are based on a relatively small number of people, deflate presumptions about upward mobility among the poor. Her detailed and engaging portraits show that the factors that make a difference in the lives of the working poor generally are the same ones that make a difference in the lives of wealthier American workers: education, family structure, work experience, and luck. The high value placed on work and the meaning it adds to individuals’ lives reaches far deeper into the inner city than many sociologists previously believed, she found.

In 1993, Newman was teaching at Columbia University and living in West Harlem. Each Monday she would walk down 125th Street on her way to work, and see the street crowded with others who were also going to work. It struck her that these people, rushing to get to their jobs, clearly were not the ones William Julius Wilson was writing about in 1987 in his landmark work, The Truly Disadvantaged. Wilson, Newman explains, argues that one consequence of deindustrialization was to move jobs out of cities, leaving behind an underclass that was trapped and for whom welfare had destroyed the concept of work. “It was clear to me from the beginning that Wilson’s numbers were a misrepresentation of a neighborhood that he painted in very broad brush strokes,” Newman says.

Newman set out to document the stories of the 200 individuals who had landed jobs in the fast-food restaurants in Harlem and Washington Heights and the 100 others who later were turned down. Then, over eight years, against a backdrop of increasing national economic prosperity — high growth, low unemployment, and negligible inflation — Newman revisited some of her subjects to see how they were doing. She and her team conducted extensive research, consisting of personal interviews and field observation. In addition, 12 of their subjects kept detailed diaries that provided large and small details of their everyday lives. “The methods are anthropological, the topic is sociological, and the quantitative analysis is economic,” Newman explains about her approach. “If your mission is to communicate to a broader public, then it is important to convey a texture to the lives of your subjects, which is difficult to do in strictly quantitative terms.”

At the completion of the original project, Newman was “quite pessimistic” about the individual and collective futures of those she was writing about. “It appeared — after two years of observation — that their futures would look a lot like their pasts: poor,” she writes. And so she was surprised by her findings four years later: In general, her subjects did well from 1993 to 1997. Four years after the initial study, 73 percent of those interviewed were employed; 78 percent had a high school diploma or general-equivalency diploma, compared to 42 percent who had a diploma in 1993. In 1997, 29 percent had some college education, compared with only 9 percent in 1993. The median wage of people who were working in 1993 had increased from $4.25 per hour to $7.49 per hour.

Even more impressive are accounts of the “high flyers” Newman encountered in 2002, when 20 percent of her subjects were earning at least $15 per hour. We meet people like Jamal (a pseudonym, as are all the names in the book), who left behind not only his early-morning shift in the local fast-food restaurant in Harlem where Newman first encountered him in 1993, but his address and poor living conditions. In 2002, Newman found Jamal in northern California, where he had been employed on and off for eight years by a manufacturing plant that provides lamination for wood flooring. “In 1994, [Jamal] was earning the minimum wage and living in a rooming house in a slum, surrounded by crime and drugs,” she writes. “By 2002 ... he was earning $32,000 a year, living in a two-bedroom trailer in a pleasant community, and was a married man with three children and a fourth on the way.” His lack of education and his inconsistent level of dedication to his job “put the brakes on Jamal’s occupational mobility,” Newman concedes, but “measured by the distance he has traveled, Jamal has a lot to be proud of.”

Kyesha, a single mother working the drive-through window of a restaurant in 1993, had managed to find similar success, landing a highly coveted public-sector job as a caretaker in the Malcolm X Housing Project in Harlem. “These jobs are among the few prospects for steady work with benefits, like health insurance, pensions, disability, and overtime,” Newman writes. “Kyesha finally has landed in civil-service paradise, which is exactly what she hoped for back in the years when she worked for minimum wage at Burger Barns.” (“Burger Barn” is a pseudonym for a national chain of fast-food restaurants.) Her future looked bright indeed, with possibilities for promotion and increased pay.

And there was Lauren, who was rejected for a job in the Harlem Burger Barn in 1993, but by 2002 was earning about $30,000 per year in the accounting department of a prominent nonprofit foundation. Lauren had spent a summer in a public-jobs program for teens, parlayed the experience into an internship where she was trained in accounting, and – when she became pregnant and was forced to go on welfare — went back to school. A series of temporary jobs led to the position in the foundation because, Newman writes, “Lauren’s instincts about the value of education were right on target.” The foundation job offered tuition reimbursement for any further education she wanted to pursue.

Progress up the job ladder was by no means universal — about a third of the people Newman revisited in 2002 were unemployed or still earning minimum wage. But the degree of movement generally was surprising, and “the fact that the Harlem study was undertaken during strong economic conditions does not seem to overstate the extent of upward mobility,” she says.

Jamal, Kyesha, and Lauren advanced their careers by means of fairly traditional strategies: acquiring more education or training, climbing the rungs of internal job ladders, especially in firms that were growing, and/or landing a union or civil-service job. They also frequently switched jobs (a tactic Newman deems “crucial to getting higher wages” regardless of the economy), and relied on family networks for child care and temporary housing. Their paths up the ladder were neither linear nor constant; they moved in and out of employment, but never stopped trying to get ahead.

Often what propels the poor onward and upward is their “strong personal belief in the value of work even as they are confronted, day after day, with lifestyles or attitudes that contradict their beliefs — often within their own families,” Newman writes. As Adam, arguably the highest flying of Newman’s high flyers, says: “You know that saying, ‘Keeping up with the Joneses?’ Well, I am the Joneses.” This finding is in contrast to most sociological research on concentrated poverty, which “emphasizes how the inner-city poor are separated from the rest of American society,” Newman notes. Nothing, she argues, could be farther from the truth: “What we see through their eyes ... is a powerful commitment to values that pull them closer to a conservative ‘red-state’ perspective than the liberal ‘blue-state’ view that most sociologists, including myself, subscribe to,” she writes.

Working “sustains a person’s sense of place in the American cultural universe by locating even low-wage workers on the right side of the moral barrier that separates them from those who have absented themselves from the work world,” Newman writes. “Every time the question was asked, a clear majority of our respondents told us they would choose work over welfare.”

Scholars have praised Newman’s latest book for its scope as well as for its substance. “Newman’s accomplishment is to keep studying a group of low-income individuals long enough to see how their lives change,” says Andrew Cherlin, Griswold Professor of Sociology and Public Policy at Johns Hopkins University. “This long attention span is rare, even among fine scholars.”

Others have praised Newman’s interdisciplinary approach — an approach that she also uses in new joint doctoral-degree programs in politics and public affairs, psychology and public affairs, and sociology and public affairs that she and her colleagues have created for launch next year. “The core of the enterprise is a three-semester seminar that introduces doctoral students to the contributions all four of these fields make to our understanding of social inequality,” she explains. She brings this approach as well to an undergraduate course she is teaching this semester, “Health, Housing and Employment: What Works for the Poor in Small Cities,” a course that is grounded entirely in community-based research. Working closely with the Trenton community organization Isles, students are learning firsthand about the theories and practice of tackling urban poverty – just as their teacher did.

 

The psychology of economics

Eldar Shafir

(Illustration Jean-François Martin; photo: Jon Roemer/courtesy Woodrow Wilson School)

The psychology of economics: Studying ‘quirks and weaknesses’

If Professor Eldar Shafir had his way, more industries would recognize that the customer is not always right. Take funeral parlors, for example, where clients often function under great strain and grief — and can be moved to buy expensive caskets and extras that reason would tell them are unnecessary. “Human beings are generally fallible in systemic and important ways,” says Shafir, 47, “and it may benefit us not to assume that we can do things we often can’t do well.”

That perspective — a foundation of the growing field of behavioral economics, of which Shafir is a practitioner — contradicts the traditional view that consumers are rational beings who make choices based on reason. “It is commonly believed that people make calculated and controlled decisions, but research demonstrates the substantial influence of situational factors on the way we think and act,” says Shafir, a professor of psychology and public affairs. He believes that the classical assumptions are compelling because they appeal to our intuition as well as to an idealized view of how we view ourselves. But we’re all subject to “quirks and weaknesses” that make us less than perfectly rational. “As a behavioral scientist, you try to narrow the gap between what we theorize about human behavior and what people actually do,” he says.

A native of Israel, Shafir has been at Princeton since 1989, and has investigated behavioral aspects of decision-making across many disciplines — including economics, politics, and medicine — and across socioeconomic groups. Currently, he and his team of collaborators, including colleagues at Harvard, Yale, the University of Chicago, and the Brookings Institution, are investigating decision-making among lower-income people, and debunking perceptions that poor individuals make decisions based either on well-calculated adaptations to their circumstances or on unique misperceptions of a “culture of poverty” with values that differ from the mainstream. Rather, he says, the behavioral decisions of the poor are no more calculated or deviant than those of the educated and affluent. What do vary among economic groups are the consequences of similar behaviors: Since people in poverty have little margin for error, those decisions can have a much stronger impact on their lives.

While the approach may be the same, different things matter to the rich and poor in their spending decisions. For example, Crystal Hall, a graduate student working with Shafir, travels weekly to Trenton and Philadelphia, where she tries to determine what matters most to residents of poor neighborhoods when choosing between two contracts for cable-television service. Hall proposes one contract with a company that is familiar; another — with better fiancial terms — with a company the residents don’t know. The same options are presented to residents of affluent neighborhoods. Most low-income residents in the study are willing to pay more for service from a familiar company, while wealthier people tend to choose the option that is attractive financially. Shafir theorizes that the issue ultimately is one of recourse: “The poor are more wary of something going wrong and are more sensitive to issues of trust.”

According to Shafir, factors such as hassle or embarrassment can appear inconsequential in standard economic cost-benefit analyses — but they deter people in important ways. One example is the recent debacle over Medicare Part D: Many senior citizens found the choices too difficult to make. “If you talk to the policy-makers, they recognize that facing lots of options is confusing, but feel confident that people will ultimately focus on the important details and make their decisions,” he says. Instead, Shafir has found that feeling hassled or conflicted can deter people from making any decision. Similarly, Shafir and his colleagues have observed that residents of low-income neighborhoods often pay more to process checks from local check-cashing services rather than open bank accounts where they might have to navigate an intimidating, unwelcoming, and complicated system. They might patronize a business with more personalized service — even if it costs more — to avoid the “condescension, suspiciousness, or uncertainty offered by many institutions,” he says.

Shafir believes his work contributes to efforts to devise nonintrusive systems to help people make better choices — in some cases, by giving them fewer choices: Think automatic-payroll deduction plans for savings and retirement programs. For example, Shafir believes that people will save more if they are encouraged to commit to higher payroll deductions whenever they receive a salary increase. And they would eat healthier foods if cafeterias were designed differently. “There’s evidence that plate size and packaging, as well as the order in which food is presented — salad before fruit before dessert — influences what people eat,” he explains. “Simply placing the soda machine around the corner in a school cafeteria [instead of by the main entrance] is likely to lower consumption.” end of article

Kathryn Levy Feldman ’78 is a freelance writer in Bryn Mawr, Pa.

 

 

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