Tags: job | wage | economy | gap

Fiscal Times: Job Woes May Continue to Curb Economy

Wednesday, 13 Aug 2014 09:51 AM

By Dan Weil

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While many economists expressed enthusiasm for the 209,000 payroll increase in July, the sixth straight month of gains exceeding 200,000, the celebration may be premature.

That's because jobs lost during the recession paid a lot better than do the ones replacing them.

"While it is no secret the recession wiped out millions of higher-paying jobs and forced many former middle class workers into second-rate jobs, the longer-term effects of this phenomenon could pose obstacles to continued economic growth," according to The Fiscal Times.

Editor’s Note:
5 Shocking Reasons the Dow Will Hit 60,000

A new study from the U.S. Conference of Mayors shows that jobs that were eliminated in sectors such as manufacturing and construction paid an average $61,637 a year, compared with $41,171 for substitute jobs in the healthcare, food and hotel industries.

"While the economy is picking up steam, income inequality and wage gaps are an alarming trend that must be addressed," said Sacramento Mayor Kevin Johnson told The Times.

"Left unabated, the wage gap, moreover, will continue to pose serious budget problems for states and the federal government, as families relegated from the middle class to lower income rely on social services and tax breaks to make ends meet, The Times noted.
Average hourly wages rose only 2 percent in the 12 months through July.

To be sure, not everyone is pessimistic about the employment picture. Bob Funk, CEO of staffing agency Express Employment Professionals in Oklahoma City, sees plenty of job openings for his workers. "We're short of people in a number of cities," he told Bloomberg.

So now Funk is trying to find workers for jobs instead of jobs for workers. "We're back in the recruiting market again," he said.

Editor’s Note: 5 Shocking Reasons the Dow Will Hit 60,000

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