I don't know how administration officials can really believe that unemployment is structural -- that is, some industries have reached new levels of productivity and simply don't need as many workers -- because if that were true, we'd see a healthy
February 1, 2011

I don't know how administration officials can really believe that unemployment is structural -- that is, some industries have reached new levels of productivity and simply don't need as many workers -- because if that were true, we'd see a healthy recovery in other sectors, and we don't. No, the real problem is that corporations have used this recession as an excuse for massive layoffs, and holding that threat over remaining workers to keep wages low and work loads high:

There are two problems with the jobs recovery: Employers haven’t added enough jobs. And those they have added aren’t particularly good ones.

The former problem has gotten a lot of attention, with many economists and politicians talking about job growth averaging less than 100,000 a month last year, not enough to keep up with population growth or make a significant dent in unemployment.

But experts say the low-wage jobs that have been added are also a serious problem — putting downward pressure on wages and keeping consumer spending in check.

“Growth has been concentrated in mid-wage and lower-wage industries. By contrast, higher-wage industries showed weak growth and even net losses,” said Annette Bernhardt, policy co-director for the National Employment Project. She said that growth has been far more unbalanced than during previous job recoveries.

Bernhardt’s analysis of the first seven months of job growth in 2010 found that 76 percent of jobs created were in low- to mid-wage industries — those earning between $8.92 to $15 an hour, on average, well below the national average hourly wage of $22.60 in 2010.

She said a preliminary analysis of full-year results suggests the same trend is still holding true, although she cautioned that final employment figures are needed.

But the biggest problem is continued job losses in higher-wage industries severely hit by the bursting of the housing bubble — construction and financial services. Recoveries in those sectors helped lead the economy out of earlier downturns, but they’re still suffering more than a year and a half after the official end of the Great Recession.

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