Stuck in a low-wage job? Try sales, new study suggests

Sales occupations are one of the best pathways out of the rut of a low-wage job, says a new study.

Only about one in 20 people in low-paying jobs manages to move into higher-paying jobs within the next year, the study finds. Of those that do, many land in various kinds of sales work, including insurance sales, wholesale and manufacturing sales, and financial sales.

Financial sales jobs are particularly attractive because they pay well above average, and yet a good percentage of workers in the field are former low-wage workers, according to the study, which is entitled “Can Low-Wage Workers Find Better Jobs?”

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Sales jobs are ideal for low-wage workers who have strong people skills, the authors say. In contrast, most well-paying jobs in health care are effectively off-limits to low-wage workers because they require education, training, and certifications that most low-wage workers lack.

Other occupations that pay well and have a good share of former low-wage workers in their ranks are advertising and real estate. Also, many low-wage workers move up to being first-line food-service supervisors, although pay in that job isn’t quite as good.

Truck driving is by far the most common job for people moving up out of the lowest-wage work, but that’s because there are a lot of truck drivers in the U.S.; the share of truck drivers who used to be in low-wage work isn’t particularly high. Also, truck drivers on average don’t score high on the authors’ job-quality index, which takes into account pay, benefits, prestige, and steadiness of working hours.

Older workers are the least likely to transition out of low-wage work into better jobs. Reasons for that “may include a reluctance to give up the perks that come from seniority in a job (even in a low-wage occupation), a risk aversion associated with leaving their current job, or even an unfamiliarity with some of the technologies that are commonly used in job searches and/or higher-quality jobs,” the authors write, concluding that these workers deserve special attention.

Getting an education—no surprise—is a good way to get out of a dead-end job. The study found that people in low-wage jobs who had four-year college degrees were the most likely to move up and out. People who lacked a high school degree were the most likely to become unemployed or leave the labor force entirely.

The study, published by the Federal Reserve Bank of New York, is by Todd Gabe of the University of Maine, urban theorist Richard Florida of the University of Toronto, and Jaison Abel of the New York Fed.

Peter Coy is the economics editor for Bloomberg Businessweek and covers a wide range of economic issues. He also holds the position of senior writer. Coy joined the magazine in December 1989 as telecommunications editor, then became technology editor in October 1992 and held that position until joining the economics staff. He came to BusinessWeek from the Associated Press in New York, where he had served as a business news writer since 1985.

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