Monday, April 28, 2014

The Incredible Shrinking Middle Class Jobs

Here’s what really happened in the USA (and Canada?) over the past five or so years: good jobs disappeared and low-paying service jobs replaced them:

Nearly half of the new jobs created since 2008 are low-wage jobs, while 80 percent of the jobs destroyed in the government-inflated real-estate bubble were high-wage or medium-wage jobs, according to a new report by the National Employment Law Project.

In effect, almost 2 million well-paid middle-class jobs have been converted into low-wage blue-collar jobs since January 2008, through the five years of President Barack Obama’s economy, according to the report, titled “The Low-Wage Recovery: Industry Employment and Wages Four Years into the Recovery.”

Forty-four percent of the new jobs pay less than $13.33 per hour, while only 30 percent pay more than $20 per hour, said the report, which was produced by a left-wing group, the National Employment Law Project. The remaining 26 percent of new jobs are middle-wage jobs, says the report, which is based on government data.

“Service-providing industries such as food services and drinking places, administrative and support services, and retail trade have led private sector job growth,” says the report, which does not mention Obama or his policies.

“These industries, which pay relatively low wages, accounted for 39 percent of the private sector employment increase over the past four years,” said report, which adds to a recent series of studies and polls showing a steep drop in the number of people who believe they are middle-class.

After four years of slow growth, the number of jobs has returned to the 2008 level, even as the U.S. population grew from 303 million in 2008 to 318 million in 2014, largely because of immigration.

And here’s the graph that shows what happened in the USA:

What’s clear is that the good times are gone, and the US economy is struggling to find a growth formula that will restore those times. So far, no really effective answers have been found.

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