Resolving America's Human Capital Paradox: A Jobs Compact for the Future

Authors

Thomas A. Kochan, Massachusetts Institute of Technology

Issue Date

March 2012

Abstract

It is widely recognized that human capital is essential to sustaining a competitive economy at high and rising living standards. Yet acceptance of persistent high unemployment, stagnant wages, and other indicators of declining job quality suggests that policymakers and employers undervalue human capital. This paper traces the root cause of this apparent paradox to the primacy afforded shareholder value over human resource considerations in American firms and the longstanding gridlock over employment policy. I suggest that a new jobs compact will be needed to close the deficit in jobs lost in the recent recession and to achieve sustained real wage growth.

Series

Policy Paper No. 2012-011

DOI

10.17848/pol2012-011

Sponsorship

W.E Upjohn Institute Grant no. 11-136

Keywords

human capital, social capital, human resources, job quality, job growth, wage growth, income inequality, job satisfaction, social contract, jobs compact, living standards

Subject Areas

LABOR MARKET ISSUES; Wages, health insurance and other benefits; Inequality