Report: Job growth concentrated in low- to mid-wage industries

“If these trends continue, the slow recovery, combined with imbalanced growth, could make it much harder for workers to find family-supporting jobs and pose real obstacles to restoring consumer demand,” she said. “It’s imperative that we keep a close eye on industry growth trends as the recovery proceeds.”

NELP’s analysis shows that current private-sector employment is still below pre-recession levels after the nation’s economy lost more than 8.84 million jobs during the recession, and factoring in population growth during that time. 

Current estimates indicate that the economy still faces a deficit of roughly 11 million jobs, according to the report.

The unemployment rate in January was 9 percent, a decrease from December, but the economy has struggled to accelerate job growth. 

NELP’s analysis looks at 82 detailed private-sector industries and tracks their job loss and growth in three wage brackets, finding that while losses were skewed toward mid- and especially higher-wage industries, job growth has shifted toward mid- and especially lower-wage industries in the past year.  

Compounding this jobs deficit, the 1.26 million jobs added during the last 12 months reveal a striking imbalance in where jobs were lost versus where they have been gained.  

Overall, lower-wage industries represented 23 percent of job loss and 49 percent of recent growth, while mid-wage industries constituted 36 percent of job loss and 37 percent of recent growth. Higher-wage industries made up 40 percent of job loss, but only 14 percent of recent growth.

The NELP study also finds that, so far, the recovery appears far worse than during a similar recovery period following the 2001 recession, which was also considered a “jobless” recovery. 

Looking at both periods, and the amount and distribution of growth, NELP’s comparison of the first 12 months of private-sector job growth in the 2001 and 2008 recessions reveals very disparate records.

Following the 2001 recession, after a year’s worth of job growth, the private sector had recovered almost half (47 percent) of the jobs it had lost. 

By contrast, after a year’s worth of job growth, the private sector has to date recovered only 14 percent of the jobs that it lost during the 2008 recession.

Additionally, in the 2001 recession, higher-wage industries represented almost one-third (31 percent) of first-year growth, whereas that same income group has only experienced 14 percent growth following the most recent downturn. 

The housing market downturn and the financial crisis in 2008 have hampered the return of higher-paying jobs in construction and finance-related industries. 

Although industries are not the same measure as occupations, the report notes, they do provide a look into the types of jobs being created in the economy and an indication of the economy’s strength, long-term growth and international competitiveness.  

“While it is too early to predict if these disconcerting trends will continue, understanding the behavior of these industries is critical because they constitute the fundamental building blocks of our economy,” Bernhardt said. 

“These patterns of slow and unbalanced growth underscore the urgent need to create new and good jobs. In the months and years ahead, it will be critical that the public and policymakers focus on the core question of what kind of economy we are rebuilding for America’s working families.”