The Great Recession Rages on in Spite of Job Growth
The Great Recession is leaving deep scars on the economy in spite of 4% annualized economic growth last quarter. Job growth continues to be anemic at best while the damage to American workers remains deep.
Job growth barely positive, while earnings are sharply negative
Jobs growth in the U.S. since the 2008 recession has been undermined by lower wages, with workers earning an average 23 percent less than earnings from jobs which were lost, a report by an organization representing U.S. cities said on Monday.
The average annual salary in sectors where jobs were lost – particularly manufacturing andconstruction – during the 2008-9 financial crisis was $61,637, according to the report by the United States Conference of Mayors (USCM), which represents cities with populations of more than 30,000.
Job gains through the second quarter of 2014 in comparative sectors showed average wages of $47,171, implying $93 billion in lower wage income, the report said. (Reuters)
Six years into the Great Recession and job growth is still sluggish
Job growth over the last six months has been about 200,000 jobs a month, but at the beginning of the Great Recession, it was a widely stated fact that jobs would need to grow at a rate of over 300,000 a month just to keep up with population growth. Annual population growth due to immigration alone is 225,000 people a month, putting the increase in jobs each month lower than the increase in migrant workers. Is it any wonder, then, with so many people coming across the border who are used to slum-level wages, that wages in the U.S. are in steep decline.
Job growth anemic due to insourcing the outsourcing
Don’t argue with the emotional aspects of immigration. Do the math. It’s simple. The U.S. government has a policy for helping major corporation that are not able to outsource jobs. The main industry here that cannot outsource jobs is hospitality, including both lodging and restaurants where all work has to be done inside the U.S. This industry, along with U.S. agriculture, could not benefit from the outsourcing of jobs that manufacturing industries enjoyed during the Bush I and Bush II years under NAFTA and other free-trade agreements.
The solution for these political contributors — by both Republicans and Democrats — is to insource the outsourcing. Neither party takes serious steps to end the importation of an enormous cheap labor pool because both parties want to give those industries that are home bound the same opportunity for cheap labor that manufacturing industries benefited from. Bring that cheap labor supply home.
You may not like where I’ve gone with this argument from an emotional standpoint of what’s nice toward good people from other nations, but do the math; it’s simple: So long as you allow more workers into the country to take U.S. jobs than the number of new jobs you have to offer, and so long as those people are willing to work for less than the people already here, wages will keep going down. Many of the jobs in hospitality and retail and agriculture are low-skill jobs, so any hard worker that will work for less will be hired first. Simple business economics.
And for people coming from south of the border, less is literally more! They’ll gladly take lower pay over what they have at home. We are insourcing the outsourcing, and American labor bears the full cost. You cannot bypass mathematical reality with emotions. You can only cloud reality in order to avoid dealing with unpleasant facts.
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