Report: The Low-Wage Recovery and Growing Inequality
Two years into the recovery, America’s good jobs deficit continues
Two years into the recovery, the majority of new jobs being added to the economy pay just $13.83 per hour or less, a new report from the National Employment Law Project shows. While the job losses during the recession were concentrated in mid-wage occupations, the subsequent employment gains continue to come heavily in low-paying jobs, reinforcing a rise in inequality that has been shaping the U.S. economy for decades.
"The recovery continues to be skewed toward low-wage jobs, reinforcing the rise in inequality and America’s deficit of good jobs,” said study author Annette Bernhardt, Policy Co-Director at the National Employment Law Project. “While there’s understandably a lot of focus on getting employment back to pre-recession levels, the quality of jobs is rapidly emerging as a second front in the struggling recovery.”
The report, an update to NELP’s past analyses of job trends during and after the Great Recession, finds that the lowerwage occupations that have grown the most during the recovery include retail salespersons, food preparation workers, laborers and freight workers, waiters and waitresses, personal and home care aides, and office clerks and customer representatives [SEE CHART].
During the recovery (the first quarter of 2010 through the first quarter of 2012), the report finds that employment in lower-wage occupations grew 2.7 times faster than in mid-wage and higher-wage occupations [SEE CHART]. Specifically:
- Lower-wage occupations were 21 percent of recession losses, but 58 percent of recovery growth.
- Mid-wage occupations were 60 percent of recession losses, but only 22 percent of recovery growth.
- Higher-wage occupations were 19 percent of recession job losses, and 20 percent of recovery growth.
The report examines employment trends in 366 detailed occupations, with lower-wage occupations consisting of occupations with median hourly wages from $7.69 to $13.83; for mid-wage occupations, the range is $13.84 to $21.13 an hour; and for higher-wage occupations, the range is $21.14 to $54.55 an hour (all in 2012 dollars).
How much the federal minimum wage would be if it had kept up with inflation over the past 40 years. Instead, itís $7.25. Learn More
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