Work and Benefits: the Multiple Problems of Service Sector Employment
Author(s)
Nelson, Joel I.
Abstract
Services are the most rapidly growing economic sector in contemporary industrialized societies. But an increasing number of studies suggest sharp deterioration in standards of living among workers in the service economy. This paper presents evidence suggesting that employment in services decreases workers’ fringe benefits. Data from 129 industries indicate that fringe benefits are lower in services than in manufacturing, independent of earnings, of worker characteristics and core-peripheral status. The data further indicate multiple handicaps of service sector employment: service workers not only receive fewer benefits than manufacturing workers, but workers in low-end industries – those with the most meager resources – are less likely to receive benefits than comparable workers in manufacturing. The paper concludes by underscoring the implications of industry for understanding benefits and highlighting the growing critique of service industries as eroding the economic well-being of workers.
