Job Growth is Coming in the Wrong Area

Job growth during recession has been well below what the economy needs it to be, unable to keep up with the rising population. And according to a report by the National Employment Law Project released Tuesday, the jobs that are being created tend to be lower-paying ones.

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Sales, office clerks, cashiers, food preparation — these low-paying jobs grew 3.2% in the first quarter of 2011 over a year earlier. Higher-paying jobs, many of which require skills and a degree such as nursing, engineering, and finance, declined by 1.2%. What the report calls mid-wage positions — paralegals, customer service representatives, machinists — grew 1.2%.

Between the first quarter of 2008 and the first quarter of 2010, 60% of the jobs lost were mid-wage jobs, 21.3% were lower-wage jobs, and 18.7% were higher-wage jobs. Wages fell among the lowest-earning occupations while higher-paid employees who managed to keep their jobs actually saw a slight increase in their wages during the recession. While fewer higher-wage jobs were lost between the beginning of 2008 and 2010, those jobs have continued to decline over the last year.

The study outlines its three wage categories thusly: Those earning $7.51 to $13.51 an hour (in 2011 dollars) were considered lower-wage, those earning $13.53 to 20.66 an hour were considered mid-wage, and those earning $20.67 to $53.32 an hour were consider higher-wage. The NELP study, by focusing on wage rather than occupational categories, shows that middle-class jobs have been declining, which economists worry is widening the gap between the rich and the poor.