The Dual Labor Market

 Because demand is inherently uncertain in a market economy, firms

expect demand to fluctuate.

 The Primary Sector of economy produces for stable demand. Big firms
invest in fancy machinery to produce large quantities of output by means
of automated production. Jobs are secure because employers expect to
run these machines for the long term, and are willing to invest in workers
training and job security to get the most out of their factories.

 The Secondary Sector of economy produces for unstable portion of

demand. Small employers are reluctant to invest in expensive machinery,
since they cannot sell it off in downturns. Production is labor-intensive,
and employers prefer workers whom they can lay off at a moment’ s
notice.

 Note that the primary sector corresponds to what Marx would term the
Army of Labor: good working class jobs, promotion potential, long-term
contract. The secondary sector corresponds to what Marx would term
the Stagnant Pool of Labor: bad working class jobs, no promotion
potential, no job security. These secondary sector jobs may also be at the
bottom of the status hierarchy.