Mar
24
Class 16: Job Creations // Sheena Chin
March 24, 2015 | 1 Comment
From all the readings and class discussions we have had in class regarding income inequality, one variable we have yet to discuss is job creations relative to workforce participation. We have learned collectively that income inequality has continued to skyrocket in New York City and the whole United States, but we have not considered the workforce participation, namely the lack of. These articles in the reading today shed light on this variable and bring to light an interesting perspective.
The first article discusses how the wage gap widened from recession as income inequality grows. Basically, this summary briefly reports how average annual job wages have gone down significantly since the recession, at a record breaking loss of $93 billion in American wages. The most confusing part of this statistic is that even though the economy has long since been picking up since the recession of 2008, it is bewildering how there could still be wide wage gaps.
In the second article, I really appreciated how the writer simplified the problem without the use of statistical jargon. In short, workers are giving up finding jobs. In fact, about 3 million workers to be approximate. Discouraged from the recession, research and studies have found that many of these workers who were laid off back in 2008 have stopped looking for work altogether. This year, the article reports that a record breaking of just 142,000 employees were added onto payrolls, where in past years, this number has not gone less than 200,000. From this article, job creation decreases could really explain that perhaps the loss of workers in the workforce could have skewed income inequality numbers.
From the third article, interestingly enough, it reports on how research have shown that in most states that have raised the federal minimum wage, all but one of the listed states have seen increases in job creation and employment rate. The article also states that while this simple research alone cannot explain full causality regarding arguments on minimum wage increases, it does pose as evidence against politicians and economists who claim otherwise. What brings to mind especially is the article last week by Goodman who states that raising the federal minimum wage will do nothing for Americans as those who usually benefit are high schoolers or college students who become employed at menial jobs. What this article has given insight to is that perhaps raising the federal minimum wage can encourage job participation and increase job creations.
Collectively from these three articles, they pose as interesting new topic discussions as they bring to light wage gaps relative to missing workers in the workforce, while the last article shows evidence of a solution in closing in on those gaps. From the recession, we have learned that 1) workers are discouraged and many have given up finding jobs and 2) job creations have been decreasing following the recession. From raising the federal minimum wage, and from the research provided, it is logical to believe that wage increases could ultimately, help in bringing back discouraged workers and close the gap in wages.
