August 12 2014

The REAL 77-Cents Wage Gap: New Jobs Pay 23 Percent Less than Pre-Recession Jobs

Charlotte Hays

The inflated and discredited 77 cents figure for the gender wage gap turns out to be the correct figure for another wage gap: a study has found that new jobs pay 23 percent less than those lost in the Great Recession.

The study is from the US Conference of Mayors and HIS Global Insight. James Pethokoukis quotes from it:

In 2008 and 2009 the US economy lost 8.7 million jobs. By examining the sectors from which the jobs were lost, most notably manufacturing and construction, we find that the average annual wage in sectors (current wages weighted by number of jobs) where jobs were lost in the downturn was $61,637. A similar accounting of the jobs gains through 2014 q2 shows average wages of $47,171 per year.

This wage gap, at 23%, is significantly larger than that of the earlier recession and recovery, and implies $93 billion in lower wage income. Extensive job losses in high-wage manufacturing ($63K) and construction ($58K) sectors were replaced by jobs in the lower wage sectors of hospitality ($21K), health care ($47K), and administrative support ($37K).

Pethokoukis also calls our attention to a report from the National Employment Law Project that indicates that job growth has been mostly low-wage jobs.

What this all means is that Americans are poorer than we used to be. Our big government, feminist friends do not want to talk about this 77 cents wage gap because it reflects badly on the policies of the Obama administration. This 77-cents wage gap is what we see when policies render companies unable or afraid to hire.

So, by golly, there is a 77-cents wage gap after all--just not the one you've heard so much about from our friends on the left.  

 

 

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