Dreams Deferred: Downward Mobility and Making Ends Meet in the Service Sector

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Research Brief PDF

Nearly one-in-five jobs in the United State are in the service sector, including in retail, grocery, pharmacy, fast food, and fulfillment, but there are countervailing views on who works these jobs and to what end. One view in the public imaginary is that service-sector employment is dominated by workers who are temporarily in this line of work and using it as a source of extra income or as a first rung on a ladder towards career growth and economic opportunity (Selyukh, 2021). But, an alternative view is that many workers rely on service sector work to get by—and to support families of their own—and that these jobs may be more poverty traps than mobility ladders (Carre & Tilly, 2017). Prior research finds very low rates of transitioning into higher-paying occupations from retail and hospitality work compared to other sectors of the economy (e.g., Escobari et al., 2021). Further, headlines have touted wage gains in the service sector in the past two years (Rugaber, 2023), but given steeply rising consumer prices, these workers may still be struggling to “get ahead” or even to meet their own basic needs (Brooks, 2022).

To adjudicate between these two views of service sector employment, we draw on a novel source of survey data collected by the Shift Project in the spring of 2022 from 2,601 workers employed at the largest firms in the retail, food service, hospitality, grocery, fulfillment, and hardware sectors. These data allow us to gauge workers’ class identification and experience of upward or downward mobility relative to their parents. We also examine workers’ experiences of material hardship and economic insecurity as well as their expectations for future upward mobility and how job quality shapes those forecasts. These data provide an unprecedented view into the personal histories, economic realities, and career trajectories of service sector workers.

We find that virtually all respondents consider themselves working class, and the majority also consider themselves lower or lower middle class. In terms of their jobs, most service sector workers have experienced downward mobility compared to their parents. We find evidence of deep economic hardship and insecurity, indicating that these jobs are not providing workers with sufficient resources to meet their material needs or to save. Workers do not feel like they are getting ahead, but rather just making ends meet or falling behind. By and large, their short-term goals are to get by or achieve some sense of stability, rather than to move up the income ladder. For most workers, it does not appear that service sector work is facilitating upward mobility.

However, all jobs are not equal in the service sector. Workers with higher wages, more generous benefits, and especially more stable schedules are more likely to report economic stability or to be getting ahead in their current jobs. They are also more likely to be working towards upward mobility or economic stability than towards just being able to make ends meet. It is possible for these sectors to create conditions that promote economic well-being and make upward mobility more attainable.

Finally, despite their experiences of downward mobility (compared to their parents and within their own working lives) and economic hardship, workers are optimistic about their upward mobility over the next five years, and parents have high hopes for their children.

Read the full brief here.