An analysis of the industry called a barometer for the economy to help explain the disenfranchisement we feel.
The corner store that you used to go in as a kid got demolished a little while ago. You felt a twinge of sadness remembering the ice cream sandwiches and other snacks that your parents used to buy as treats, and recall that the family who owned it was always so friendly. With the smell of greasy hotdogs in their rolling racks fading from memory, you notice a sign that proclaims a new Apartment complex with units in an “exclusive” location will be opening its doors next year. In the last decade we have seen an increasing number of small businesses shutting down in favor of corporate development, specifically with a lot of rental properties or chains being erected in the spaces that were once fairly quiet but are now surrounding by urban sprawl. This is due to a multi pronged attack on the lower class by corporate interests through deregulation, unchecked inflation, twisted subsidy policies, and Wall Street corruption.
Gone are the days of an entrepreneur starting a small business and building a brand up around that community. Architecture is an industry that used to rely heavily on the successes of individual entities rather than corporate, and it is a fantastic reflection of the wider entrepreneurial market. With the economic and educational boom in the 50’s for (mostly white) middle class families, it was possible to support yourself through school by working to pay for tuition and living expenses. For example my father started a small firm in Tucson during the 90’s after obtaining a degree from the U of A and working in construction to pay his way through school. Now, the way that the architecture industry has been structured relies heavily on local firms that independently bid for the smaller projects, while larger corporate firms take on commercial and big scale industrial ones. In many ways this industry is reflective of the American dream; smaller firms can build their reputation from the ground up, and if their work is of high enough quality they can achieve huge success. Therefore it has historically been a lot of independent firms, such as my dad, starting up and competing within the market to prove their ability. 77.3% of firms have 9 or fewer employees, with 99.6% of the wider industry still having fewer than 50.
The problem with a small business dominated field is that individuals are much more susceptible to economic downturn without corporate backing. Architecture is intimately tied with the real estate and during a backslide in property values, such as during the Great Recession, the field is one of the first to feel impacts and ends up being hit harder than most sectors. Since 2008 there has been a drastic shift towards corporate domination as small firms were forced to close or engage in mergers with larger competition in order to survive as private real estate, small architects’ bread and butter, ground to a halt with foreclosures skyrocketing. (I discuss the causes and fallout from 2008 more in depth here). Over half of any new startups since the big crash have failed within their first 5 years, and nearly three quarters are gone by 10. Further, small business now only represents 20% of the total architects employed and a meager 15.4% of profits. This isn’t even taking into account the effects of COVID-19 yet, and an impending commercial real estate plummet. In interviews with small firms that had managed to survive the recession, the overwhelming consensus was that a deregulated market has allowed for corporate interests with big money to dominate. And thus, all roads lead back to Wall Street, right?
As massive financial entities like Blackrock gobble up real estate and contract out with local architecture firms, it has been harder to collect payment because these types of entities are much tighter with their cash, especially now during a pandemic. Prior to COVID, small architecture firms were already being forced into essentially banking for themselves, as they had to track down payment on a system of credit through the multiple layers of ownership that go into big money backed projects. On top of doing work before getting paid and having to turn into loan sharks, small firms have also experienced heavy devaluation for their work. Oftentimes they are forced to incur many of their own expenses, then get paid for their work and aren’t breaking even. If they even get paid at all, that is. Many companies already see architects as unnecessary design middlemen in the midst of their urgency to build, and skimp on payments in that way. (Many commenters in that forum mention how ironic it is that corporations are so eager to rush along projects at every stage until it comes to actually paying designers and other contractors). Especially during pandemics or in times of other economic hardship, this propensity increases exponentially to save costs.
Architects are a sort of barometer for the economy, as their profession is often one of the first to be affected by any downturn with its connection to so many industries and heavy reliance on smaller individual firms. Since the pandemic has massacred the commercial real estate market, there have barely been any new projects on that front. As a consequence, corporate architecture firms have been forced into the local housing markets that small firms normally rely on. They are able to outbid smaller firms because their coffers hold collateral cash to put towards projects that they won’t have to charge the client to cover, thus their prices come in much lower. More appealing to any entity that wants to maximize profit, yet devastating to individual firms. The chain reaction caused by Wall Street’s greed affects all small businesses, as they are boxed out of their own markets by bigger corporate competitors that can afford to lose money in order to make even more. That is literally a company like Amazon’s strategy; be able to bleed more cash than your opponent for customer convenience. Needless to say small architecture firms are being obliterated, as are all entrepreneurial start ups. The biggest hope for some is to get bought out by a corporate entity so that they have more cash to back up their business, and even still many smaller firms have to collaborate with and share what little fees they make to corporate partners anyways. The hope of pulling yourself up by your bootstraps is dead, as to even get an entrepreneurial idea going you’d need education, money to back it up, and a profit stream with huge monopolies competing against you. The cost of all commodities has skyrocketed with American inflation, allowing big business to keep up while everyone else drowns in the wake of their megayacht.
Someone like my father could no longer graduate high school, get a job in the industry they have an interest in, then pay their way through college while incurring little or no debt. The average cost of tuition in the U.S. has tripled in the last 20 years, with the average student spending $35,700 per year for tuition and living expenses. Speaking of housing and the cost to survive, everything associated with getting a college education has exponentially risen in cost. The total price of a 4 year degree (from a public school) for the average in-state student is about $103,000, with an out of state student looking to spend nearly $175,000 on average. This isn’t even taking into account private institutions, which are incomprehensibly more expensive. From the 70’s to now, tuition alone for private schools has risen from what average modern day public institutions’ is, just over $10k a year, to nearly $40,000. This would mean that if one was looking to attend a private institution in state, they would be shelling out around $70k a year at the minimum for tuition, room, and board as these schools generally have pricier accommodations too. ($70,000 is the proven optimal income range that allows maximum happiness compared to financial burden by the way, and hardly any working class Americans make half that).Total bills for a degree would easily exceed $200,000, not to mention whatever other incidental costs may come up such as books or accidents. Adjusted for inflation the total cost of a 4 year public degree in the 70’s was $42,200. Again, this is after the cost has been adjusted for 2021 currency rates. The argument that modern schools are only charging these insane tuition rates to keep up with inflation is a false narrative. Presidents and administrative staff simply want more money.
When my dad was going to school the cost of tuition was $243 ($2,708 adjusted) per year, and has since grown over 360% to be around $9,500. The income per capita for the middle class has all but flatlined in the same time frame, even dipped slightly. In the 60’s our federal minimum wage averaged $7.91 adjusted for inflation. That number right now is $7.25. This means that from 1989 until now the cost of college has increased 8 times faster than wages. 56% of students face housing insecurity each year, and nearly half reported having trouble regularly paying for food. Of the students who can afford regular meals, half of them still said that they couldn’t afford balanced nutrition. Further, we see 30% of college students living below the poverty line. To put it plainly, the system has been rigged against anyone outside the upper class. In order to help offset the massive costs of college that we can’t afford, we will take out loans from big financial entities backed by the government. Wall Street makes a killing off of these student loans; I will explain more here how they were a critical component to the runup of the Great Recession, and are still floating around on the derivatives market.
The average college attendee has over $37,000 in student loan debt. Even this system shows vast disenfranchisement, as 53% of millennials haven’t been able to purchase a home because student loan debt either disqualified them or made them unable to afford a mortgage. We can also see the results of predatory loans disproportionately targeting POC, as nearly half of black students owed 12.5% more in student loan debt than their counterparts 4 years post grad. Additionally nearly a third of African American college graduates default on their loans within 12 years due to rates that were too high. This is most likely linked to the subprime loan racket that Wall Street has had going since the 90’s, all tied in with hundreds of trillions of dollars in derivatives. It has become all but impossible to afford higher education for the average American. Then, once that piece of paper is obtained at the end of their 4, 5, sometimes 10 year schoolings, it is becoming increasingly hard for students to graduate into the workforce they have studied for. After crunching data on 125 million American professional profiles, it was found that only 27% of college graduates work in a field related to their major. Graduates tended to entirely swap fields or career trajectories while moving in and out of their first few jobs post college. Interestingly, regardless of degree, over 54% went into some form of major business function that could include sales, management, or communications. On top of this there’s been a significant rise in students pursuing marketing and administrative communications degrees over the last half decade. The reason for this is that the American education system has devolved into something that prepares us purely for 9 – 5 labor.
When noting this increase in graduates streaming to the business field, higher education experts acknowledge that this is how the future flow of turning degrees into work will look. Many labor markets just aren’t big or profitable enough for graduates with specific degrees to enter them. When the average American is tens of thousands in debt and exiting school with little to no resources (unless their family can support them), of course they are going to find the quickest work available because they need to start paying bills immediately. Ordinary people don’t have the luxury of a gap year, or time to “find themselves” before starting their professional lives. The way that our economy has been established, millions upon millions of young people entering their working lives have to settle for providing menial labor at big business. It doesn’t matter that you spent 4 years and countless hours toiling for a degree in sociology that you were passionate about, you need a wage now and the only available job is packaging for Amazon. This is just how the upper class wants it, see Neel Kashkari’s scumbag quotes. This is the crux of America right now; wage slaves that live paycheck to paycheck to ease their burdens of debt and the frenzied pace of life in this country. Jobs that provide a highly beneficial function, such as social workers, are horribly underfunded and cannot hire the amount of staff they need, or even pay them liveable wages. Not to mention there are many ludicrous requirements on experience for many jobs necessitating degrees, which recent college graduates obviously don’t have. Therefore instead of spending the time to grind and find a job they are passionate about with their degree, over two thirds of graduating Americans settle at slaving for menial, yet still guaranteed, wages that will help them pay off debt now instead of having uncertainty about how they’ll survive while searching in their field. Besides, Bezos always needs more packing drones.
The American dream is dangled above our heads like a carrot that keeps us going, thinking that one day we will reach it. Yet, the entities that profit off of our exertion on that treadmill of capitalist pursuit structure the system so that the harder we work, the less they will give us over time. Even Al Lord, one of the premier demagogues for profiting off of others’ desperation to get an education and live the American dream, claims that the rates schools charge now are “criminal.” The multimillionaire former CEO of Sallie Mae stated that he was glad he saved up for his grandkids’ education, and couldn’t understand how anyone making $50k or $60k a year could afford one. Yeah Al, no shit. He and his Wall Street buddies have entirely destroyed our financial system, creating an environment that holds anyone outside the upper class in permanent servitude for corporate crumbs. The ability to access higher skilled jobs increasingly costs us, but college is still the golden standard as more and more young people attend and put themselves in debt. When they graduate, they often find a market that forces them into renting and working for barely more than minimum wage for years unless they are lucky. Then until experience is built up, they are in limbo while saddled with debt on all sides. People are only able to think about their next paycheck, let alone be a participant in politics, focus on personal relationships, or find some kind of fulfillment.
This was nearly all taken from various points in my book. Sources below.
- Capitalism: What is it? Throughline, NPR. 2021.
- “Future of practice: Small Business,” Whittaker, Elizabeth. 2018. Architectural Record.
- “March 2020 Special Report: Moving ahead, challenging times confront the design professions.” AIA.org.
- “Covid-19 is crushing the architecture industry but not in the ways you’d expect.” Berg, Nate. 2020.
- “Average cost of college and tuition,” Hanson, Melanie. 2021. educatondata.org.
- “Al Lord Profited When College Tuition Rose. He Is Paying for It,” Mitchell, Josh. 2021.
- “Philosophy Degrees and Sales Jobs,” Fain, Paul. 2019. Inside Higher Ed. Based on Study done by the Federal Reserve of New York.