Lost in the Unemployment Numbers: Quality of Jobs
The latest unemployment numbers show an official jobless rate of 7.2 percent but, for many Americans, their new job is a temporary, low-paid, or part-time one. While the economy continues to inch towards “recovery”, the employment landscape in the United States has been irreversibly altered and mid-wage jobs continue to disappear while low-paid work is very much on the rise.
According to the Labor Department, 2.7 million workers now work for temp agencies, the most in the history of the US. Temp agency hiring has accounting for one-fifth of all the job growth in the US since the recession. Of those 2.7 million, more than 840,000 earn less than $25,000 per year. Only eight percent of temp workers have access to employer-provided health insurance.
Temp jobs are only part of the growth in low-wage jobs. During the recession, only 21 percent of jobs lost were low-wage jobs (jobs paying $7.69 to $13.83 per hour) while 60 percent of jobs lost were mid-wage jobs (jobs paying $13.84 to $21.13 per hour). Since then, just 22 percent of the jobs created have been mid-wage jobs while 58 percent of jobs created have been low-wage jobs.
In the US, a record 25 percent of workers now work in low-wage jobs. By comparison, that’s five percent higher than the UK and Canada, nine percent higher than Spain, 10 percent higher than Japan, and 13 percent higher than France.
While the number of jobs and the corporate growth since the recession paints a fairly rosy picture of “recovery”, the economy that actually affects people as opposed to share prices has not recovered. Since the recession, more than 10 million Americans have dropped out of the labor force entirely (and are no longer counted in the unemployment rate) while 7.9 million Americans only have part-time work, twice as many people as there were in 2006. It’s no surprise, then, that 76 percent of Americans live paycheck to paycheck.