Mar
24
Blog Post #10: Job Creation
March 24, 2015 | Leave a Comment
The availability of jobs has a great effect on the growing income gap and income inequality. It’s not that people don’t want to work; it’s that they are discouraged from finding a job. From the articles, it states that workers were paid more during the recession than during the recovery. Raising the minimum wage is again posed as a solution, but it only affects the people who currently have jobs, and not any of the discouraged workers.
The New York Times article was the most insightful and interesting. It’s already been five years and Americans are still doubtful from the recession. They say that unemployment has decreased, but that’s because many of the labors became discouraged. The labor force doesn’t account for discouraged workers, which are different from unemployed (people who are hopeful and trying to find a job.) One of the biggest factors that the article states is that jobs are being replaced by new technologies and loss of skill. I agree that innovation has giving us more simplicity in our lives, but we still need brains behind the technology.
You can see in “The Labor Picture in August” that there’s a lot of negative change in unemployment. This is either because the unemployed found jobs or they have become discouraged. The average duration of unemployment is 31.7 weeks but the median is 13.2 weeks. This is an interesting statistic since the mean is so much higher than the median, meaning more people are unemployed longer. However, for those who are employed, average hourly earnings only increased 0.2% over the past five years.
Ben Wolcott’s article depicts the impact of the recent state minimum-wage increases. However, he states this doesn’t imply causality. Out of the 13 states that increased minimum wage, only NJ showed a decrease in employment. Even though there was an increased in employment among the states with increased minimum wage, the states without minimum wage increases also increased in employment. The top two states with employment increases did not even raise minimum wage. Why is this? We can’t really tell if the increase is because of the increased minimum wage.
According to the United States Conference of Mayors, $93 billion was lost in wages and the wage gap has doubled from recession to recession. A solution to this is to create more jobs; the government (28,000), factory (50,000) and heath sectors (43,000) have already opened up more jobs. However, this still need to encourage job creations especially jobs for low/unskilled workers. The problem is, where will we make jobs that will encourage people to work again?
-JanYing He
