Job Woes Worsening, New Analysis Shows
News on the jobs front is bad and getting worse, according to a new analysis by the Economic Policy Institute (EPI) Research Co-Director Jared Bernstein.
The report, “The Jobless Recovery,” presents a stark picture of the continuing weakening in the U.S. labor market which, despite claims that a recovery is underway, is plagued by mounting job losses and lengthening unemployment.
“As far as the job market is concerned, the recession drags on,” said Bernstein. “The Bush Administration and Congress need to appreciate the urgency of this situation and quickly enact an economic plan that makes jobs the first and immediate priority.”
Bernstein’s report, which examines and compares trends over the past two years, notes:
— The jobless rolls have expanded by 2.8 million since the fourth quarter of 2000, the most recent economic peak.
— There are now 2.1 million fewer private sector jobs than there were at the end of 2000. Payrolls contracted not only over the recessionary year of 2001, but also over the purported recovery year of 2002.
— The decline in private sector jobs at this point in the recovery is greater than in any of the past three recessions/recoveries.
— The average spell of unemployment is now more than five weeks longer than in the fourth quarter of 2000. There are now 1.7 million people who have been jobless over half a year.
— The labor force is now growing only half as fast as it was two years ago, a sure sign of a weak labor market.
— The rise in unemployment has produced slower wage growth, real income losses, and higher poverty rates.
— In 2001, when the unemployment rate climbed to 4.8 percent from 4 percent in 2000, real household income fell by 3 percent for the poorest households and 2 percent for middle-income households, while poverty increased by 0.4 percentage point. Though we do not yet have 2002 income and poverty data, based on the fact that unemployment was another point higher in 2002 (5.8 percent), the incomes of low- and middle-income households very likely fell further last year.
— According to a new report from the Bureau of Labor Statistics, median weekly earnings fell 0.5 percent in real terms over the past year (from fourth quarter 2001 to fourth quarter 2002).
The report is available online at: www.epinet.org.
The Economic Policy Institute is a nonprofit, nonpartisan economic think tank founded in 1986.
