The Low Paid Jobs Recovery! Thank Goodness For Fast Food, Otherwise Many Would Not Have Any Money Coming In.

Recovery Has Created Far More Low-Wage Jobs Than Better-Paid Ones

By ANNIE LOWREY, APRIL 27, 2014

WASHINGTON — The deep recession wiped out primarily high-wage and middle-wage jobs. Yet the strongest employment growth during the sluggish recovery has been in low-wage work, at places like strip malls and fast-food restaurants.

In essence, the poor economy has replaced good jobs with bad ones. That is the conclusion of a new report from the National Employment Law Project, a research and advocacy group, analyzing employment trends four years into the recovery.

Several astute observers posit the strength in local housing is due to prosperity among highly educated workers. That idea is simply wrong; no data supports it. While people in a select few fields enjoy good wage growth, that is the exception rather than the rule. I know many people in homebuilding that took pay cuts to keep jobs, and many others who consider themselves fortunate to be paid the same as they were in 2006. Very, very few real estate related fields saw wage or job growth over the last 8 years.

“Fast food is driving the bulk of the job growth at the low end — the job gains there are absolutely phenomenal,” said Michael Evangelist, the report’s author. “If this is the reality — if these jobs are here to stay and are going to be making up a considerable part of the economy — the question is, how do we make them better?”

The report shows that total employment has finally surpassed its pre-recession level. “The good news is we’re back to zero,” Mr. Evangelist said.

We may be back to zero, but we still need to employ the people who entered the job market from 2008 to 2014, so in reality, we are still behind.

But job losses and gains have been skewed. Higher-wage industries — like accounting and legal work — shed 3.6 million positions during the recession and have added only 2.6 million positions during the recovery. But lower-wage industries lost two million jobs, then added 3.8 million.

The data is clear: high-paying jobs are fewer than before the recession, and employment gains are in low-paying jobs.

With 10.5 million Americans still looking for work — the unemployment rate is 6.7 percent — employers feel no pressure to raise wages for those who are working. As a result, the average household’s take-home pay has declined through the recession and the recovery to $51,017 in 2012 from $55,627 in 2007, after adjusting for inflation.

It isn’t likely wages will rise any time soon.

With joblessness high and job gains concentrated in low-wage industries, hundreds of thousands of Americans have accepted positions that pay less than they used to make, in some cases, sliding out of the middle class and into the ranks of the working poor.

That includes Connie Ogletree, a former administrative and executive assistant who now earns $7.25 an hour at a McDonald’s in Atlanta. “It was 40 years ago that I had my first fast-food job, at a Dairy Queen,” said Ms. Ogletree, 55. “This is my second.”

The National Employment Law Project study found that there were about a million fewer jobs in middle-wage industries — including parts of the health care system, loan servicing and real estate — than there were when the recession hit.

Economists worry that even a stronger recovery might not bring back jobs in traditionally middle-class occupations eroded by mechanization and offshoring. The American work force might become yet more “polarized,” with positions easier to find at the high and low ends than in the middle.

The local job market used to be dominated by lending and real estate. Many of those jobs are gone for good, particularly the lending jobs as mortgage applications continue to plummet.

There has also been strong jobs growth in some high-paying industries, like professional, scientific and technical services — a category that includes accountants, lawyers, software developers and engineers. That sector accounted for about 9 percent of the private-sector job gains in the recovery.

This explains much of the strength in Silicon Valley. Their real estate may not be immune as many think, but as long as the local population sees rapid job and wage growth, house prices will likely go up.

For the rest of the country, the low-paying jobs will serve as a drag on real estate prices and sales volumes. Only the lender manipulation of inventory will keep prices up.

Source: http://ochousingnews.com/blog/economic-recovery-creates-low-paying-jobs-fails-stimulate-housing/#ixzz34GhWQXn1