posted on Aug, 3 2013 @ 01:10 AM
Yesterday was the first Friday of the month, which means a new jobs report was released.
At 162,000, the July jobs report fell short of expectations and well shy of “whisper” numbers for payroll figures above 200,000. In addition,
job tallies were revised down for May and June and average hourly earnings fell 0.1% in July, the first decline since October.
Sure, jobs were added, (and hourly earnings fell .1% also) but what kind of jobs were they?
According to Alpert’s analysis, 69% of the jobs created in the second quarter – and 57% in the first half of 2013 – were in the three
lowest-paying sectors of the economy: retail trade, administrative and waste services, and leisure and hospitality. These jobs, which account for 33%
of all private sector jobs, pay an average of $15.80 per hour.
Over the past year, Ive seen plenty of "now hiring" signs just in my local area. Seems everywhere around here is hiring....except that it's pretty
much all the low-wage jobs described in the article. Retail and restaurants always seem to have their doors open.
“What you’re seeing is now the spreading of low wage growth,” he says, noting those trends continued in Friday's July jobs report.
“Really we have become a nation of hamburger flippers, Wal-Mart sales associates, barmaids, checkout people and other people working at very low
So what could this expansion of low-wage job growth do?
Taking it a step further, Alpert says the low-wage trend also explains why GDP growth remains so weak despite monthly average private sector job
growth of nearly 200,000 in the past year.
The above makes sense to me, but below is where I kind of lose track with what he says.
“The bottom line is a lot of people are coming off unemployment,” which works out to around $12 per hour if you include Food Stamps, he says.
“So a $15 wage to work has no impact… you’re not increasing consumption or the ability [of workers] to go out and buy stuff."
I have no idea where he is getting "$15 an hour". Im under the assumption that $10 and under is pretty low wage. Id love to be making $15 an hour at
Aside from that $15 an hour bit, the rest seems to sum up the past year for me.
As a result, the economy isn't getting the usual "second derivative" benefit of payroll growth whereby more people working leads to more
economic activity and additional job creation, Alpert says.
Is this a really healthy trend to continue?