People are working again (for peanuts)
by digby
Good news about job growth. A lot more people are working. Unfortunately:
The story on wages is less encouraging. The widely touted November jump in wages was almost completely reversed, with the December data showing a 5 cent drop from a downwardly revised November figure. The average over the last three months grew at a 1.1 percent annual rate compared with the average of the prior three months, down from a 1.7 percent growth rate over the last year. This may be in part due to a shift to lower paying jobs in restaurants, retail, and the lower paying portions of the health care industry. However, it is also possible that we are just seeing anomalous data. However the claims of accelerating wage growth have no support in the data.
Interestingly, there seems to be some shrift to generally less skilled production and non-supervisory workers. The index of weekly hours for these workers is up 3.6 percent from its year ago level. By contrast, the index for all workers is up by just 3.3 percent. Since the former group is more than 80 percent of the payroll employees, hours for supervisory workers would risen by just 2.5 percent. This is consistent with employment data showing much sharper employment gains for workers with high school degrees or less than for college grads. The EPOP for college grads is actually down by 0.2 pp over the last year.
I think this is probably inevitable. After such a long period of high unemployment people are conditioned to stick with their jobs and not make waves by asking for raises — and bosses are still keeping wages low because they can. It’s going to take a while for that to change. And every day it takes makes people fall further behind. Wages need to grow
But good news is good news. At long last.