Also in this Issue
- Marry or Burn The White House's new anti-poverty program: Shotgun weddings (Cover Story)
- A Brighter Shade of Green A judge orders the MPCA to take another look at a plan to burn 10 million tires a year (News)
- Burnt Out A depleted Minneapolis fire department looks for money (News)
- MPD Scandals, Continued: A Primer The Duy Ngo case: McManus bets the farm; Will Olson land on the hot seat? (News)
- There Goes the Neighborhood Allina signs on to the Sears complex; McManus takes oath (City Affairs)
- In a Little Old Shack (City Beat)
- The Night After The Golden Dawn Wearing a black mask and commanding spirits in Roger Williamson's basement (Culture)
- More articles from this issue...
More News/City Beat Articles
- Pawlenty Gambles on Stadiums Do two wrongs make a right? (Feb 18, 2004)
- A Gunman Walks into a Bar... A rash of armed robberies afflicts Twin Cities taverns (Feb 18, 2004)
- Fear of a Liberal Planet GOP telemarketers harass the elderly, groove on hip hop, and scream like monkeys (Feb 11, 2004)
- George W. Bush and the Real State of the Union How's the president doing? (Feb 11, 2004)
- I Was a Teenage Rock Star (Feb 11, 2004)
- Tax Change Undercuts Affordable Housing State could lose 80,000 units of low-cost housing (Feb 4, 2004)
- Cut the Crap Sewage sludge: Fertilizer or public menace? (Feb 4, 2004)
- Against Our Will Pawlenty and the republicans buck popular opinion on health care (Feb 4, 2004)
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Sure, jobs are slowly coming back to Minnesota. And the pay is lousy.
Take This Job and Love It
Two weeks ago a ranking Bush adviser allowed as how the White House wasn't worried about the increase in the number of jobs moving overseas. "I think outsourcing is a growing phenomenon," Gregory Mankiw, chairman of the White House Council of Economic Advisers, told reporters. "But it's something we should realize is probably a plus for the economy in the long run."
It's the kind of tongue-slip that tends to confirm more conspiracy theories than it sparks, and within days, Bush had hit the campaign trail in search of laid-off workers to console. "There are people looking for work because jobs have gone overseas," he conceded to supporters in Pennsylvania, according to the New York Times. "And we need to act in this country. We need to act to make sure there are more jobs at home, and people are more likely to retain a job." One solution, he posited, was to train U.S. workers for better, higher-paying jobs.
It's a nice idea, but there's mounting evidence that it may be a fantasy. Nationwide, more than 2.4 million jobs have been lost during the last three years. And it is true that now, more than two years after the start of the economic recovery, job creation is beginning to pick up. But according to studies prepared by economists both here and in Washington, the problem is that the new jobs are not nearly as good as the ones we lost.
According to a recent analysis of U.S. Bureau of Labor Statistics data conducted by the Washington, D.C.-based Economic Policy Institute, the jobs that vanished during the economic recovery paid much better than the jobs gained. Wages in the industries that have been gaining jobs since the recession ended in November 2001 pay nearly 21 percent less than those of industries that are losing jobs, or $35,410 vs. $44,570.
The picture's even worse for Minnesota, where the new jobs pay an average of 29 percent less. Jobs in shrinking industries here paid $42,135, while jobs being created by growing industries pay $29,780. Only two other Midwestern states scored as poorly: Illinois saw a 34 percent decline; Ohio 29 percent. (Notably, 95 percent of the 48,000 jobs that left Minnesota in the last three years were in manufacturing.)
"Twelve thousand dollars is a huge shift. It's going from what might be termed a middle-class existence to one that just isn't any longer," says Kevin Ristau, education director of JOBS NOW, a St. Paul-based coalition of organizations concerned with employment policy. "For an enormous number of Minnesota workers, it would shift them from being wage earners who are earning family-supporting wages to ones who aren't."
It's a trend that's likely to continue, adds Ristau. According to Labor Bureau statistics, of the 25 occupations that are projected to see the largest job growth in this decade, only eight rank in the top half for median wages. Eleven are in the bottom quarter.
Further, a January JOBS NOW analysis of Minnesota economic indicators shows that one-third of all job openings here are in three areas with a combined median wage of less than $8 an hour: office and administrative support, sales, and food preparation. Nearly two of every five job openings are for part-time jobs, and only 36 percent require anything beyond a high school diploma.
"There's no evidence here of a shift to high-skill occupations," says Ristau. "The survey shows that Minnesota's workers do not have a skills deficit; what they have instead is a wage deficit."
The biggest drag on wages is the high unemployment rate (up from 3.9 to 6 percent under Bush), but outsourcing is the second most important factor, according to Economic Policy Institute economist Max Sawicky. Bush's aide's faux pas notwithstanding, Sawicky believes the administration sees the flight of jobs overseas as the natural, positive consequence of free trade. "The majority opinion out there is that more is better when it comes to outsourcing," he says. "There's a lack of any serious commitment to full employment on the part of the administration."
Indeed, workers may be wondering whether the so-called jobless recovery is a recovery at all, but things are looking up for corporate America and its investors: According to JOBS NOW, corporate profits rose by an annual rate of 40 percent during the last quarter of last year. But 60 percent of the growth generated during the recovery has gone to corporate profits, while employees have seen only 40 percent of the uptick. In contrast, during previous economic recoveries, 75 percent of income growth went to workers.
About Beth Hawkins
From the Archive
- Wheeler Dealer How Minnesota cops and the war on drugs made a successful entrepreneur out of a small-time hustler and snitch named Michael Felix (Cover Story - Jan 7, 2004)
- The Parent Trap Want to be "middle class"? Don't have kids. (Cover Story - Nov 26, 2003)
- Take It Up with the Judge Judge Harvey Ginsberg seems to have a little anger problem (News - Nov 5, 2003)
- Nowhere Man Eight months ago, a man jumped from a Mall of America parking ramp. Medical examiners still don't know who he was. (Feature - Oct 29, 2003)
- Falling When Naomi Gaines threw her babies into the river, we were shocked. The truth is, her impulse isn't all that rare. (Cover Story - Aug 27, 2003)
- Mother's 'Hood Should we free our kids from the tyranny of big mother? (Homeland Insecurities - Jul 2, 2003)
- Addicted To Drug Court The Good News and the Bad News: Hennepin County’s drug court has cleared court dockets and steered a lot of people toward treatment. It’s also allowed the county to push thousands more casual offenders into the corrections system. (Cover Story - Jun 25, 2003)
- Trial By Color Minnesota courts tighten rules against race-based appeals, but it's small consolation to Dameion Robinson (News - Jun 4, 2003)
- More articles from the Beth Hawkins Archive...
