We regularly see news stories indicating that the US employment market is recovering from the impact of the great recession. After 5 1/2 years of sluggish growth total employment has finally reached the pre-recession level. However, it will come as no surprise to people who have been struggling to find employment that the available jobs are not where they used to be. New college graduates who have accumulated a mountain of student loan debt in hopes of improving their employment prospects, frequently find themselves worse off for the effort.
A new report from the National Employment Law Project provides some hard data to confirm what many people have suspected was true. Here is what the "recovery" actually looks like.
We find that during the labor market downturn (measured from January 2008 to February 2010), employment losses occurred throughout the economy, but were concentrated in mid-wage and higher-wage industries. By contrast, during the recovery (measured from February 2010 to February 2014), employment gains have been concentrated in lower-wage industries. Specifically:There is nothing about this trend that is unique to the worst economic crash since the great recession. Looking back to the period of post WW II prosperity we can see a pattern of the cumulative impact on employment that recessions have had. In the 1950s recessions predominately affected blue collar workers. Manufacturing and construction workers got laid off. People with the respectable white collar jobs mostly continued working. Beginning with the 1970s this pattern began to change.
Lower-wage industries constituted 22 percent of recession losses, but 44 percent of recovery growth.
Mid-wage industries constituted 37 percent of recession losses, but only 26 percent of recovery growth.
Higher-wage industries constituted 41 percent of recession losses, and 30 percent of recovery growth.
Today, there are nearly two million fewer jobs in mid-and higher-wage industries than there were before the recession took hold, while there are 1.85 million more jobs in lower-wage industries.
The good paying manufacturing union jobs that had given some blue collar workers entry into the middle class began to disappear as industry was shifted to low wage economies. There was a lag in the impact on white collar employment, but in the recession of the early 1990s US business discovered the buzz word down sizing and began to eliminate white collar and middle management jobs with a vengeance. When many of the people who had been the victims of down sizing eventually found new employment they were employed on temporary or contract status without benefits and even a pretense of job security.
Thus we find that the worst recession in 75 years has created the greatest shifts in the nature of employment. There really are no trends on the horizon that offer hope of a shift back toward middle class prosperity. We are steadily becoming a more economically polarized society.