The official unemployment rate has finally fallen below the 9% level (8.9% in February), but does that mean the job market is finally turning around?
Yahoo! News had a revealing?but disturbing?article on the state of the job market last week. In Jobs returning?but good ones not so much, Zachary Roth reports some of the deeper details behind the unemployment benchmark:
- 49% of the new jobs created over the past year are in low wage industries, such as retail and food processing
- Higher wage jobs represent only 14% of the new jobs, thought they accounted for 40% of the jobs lost during the recession
- 9.6% of the workforce are working part time but want full time jobs
- On the topic of wage levels, the article reported that ?though productivity rose 5.2 percent from mid 2009 to the end of 2010, wages increased by just 0.3 percent. That means only 6 percent of productivity gains were shared with workers. In past recoveries, that figure has averaged 58 percent.?
The last point is, in my opinion, the most telling of the group because it tracks the money actually changing hands. If employers aren?t sharing productivity gains with workers, then earning a living will only be harder in the future. Flat wages are effective pay cuts in an environment of rising prices.
In taking a closer look at under-employment?a statistic that I believe is now more important than the basic unemployment rate?a Gallop poll conducted in mid-February (and linked in the post above) reported the under-employment rate–the combination of the unemployed plus under-employed workers?stands at 19.6%. That?s one out of every five workers in the economy!
Are statistics giving us a legitimate picture of reality?
OK, we can look at as many statistics as we like but the numbers often don?t reflect the reality that we?re experiencing or seeing around us. From what I?m seeing, there are two types of workers right now?those who kept their jobs through the recession and have been largely unaffected by it, and those who lost their jobs and have been unable to get much traction since.
While the first group tend to have a more optimistic view of the job market and of the economy in general, those in the second group go from job to job, often without benefits of any kind, and almost always without any permanence. Re-employment as it played out in past recessions seems to be something of a myth this time around.
The high level of under-employment, in combination with flat earnings and apparent job growth concentrated in low wage industries cries out for a personal plan of action, and I?ll give my thoughts on this in my next post. In the meantime,
What has your employment experience been, and what are you seeing in the people around you?
Did you lose your job during the recession?
If you?ve been re-employed since, are you working full time or part time? Contract/temporary or permanent? Do you have benefits (or at least health insurance coverage)?
If you?re working full time, how does your current income compare to what you had before you lost your job?
Have you started your own business? If so, did you do so because of a lack of opportunities in the job market?
We?re trying to get past statistics here in favor of real life experience, so all opinions are welcome.