The Heldrich Center at Rutgers has issued a new report that says only 7% of people who lost their jobs after the financial crisis have made it back to their former levels of work and financial security. This 7% of those surveyed said they have “MADE IT BACK and consider themselves in excellent, good, or fair financial shape and have experienced no change in their standard of living due to the recession.” It is a picture of the jobs market that is reflected throughout the U.S. workforce and the prospects for improvement are small.
At the other end of the spectrum in the Rutgers study, 41% of people said they were “DEVASTED” or “WRECKED.” The people who did the survey said this translates into 2.25 million to 3.60 million, a huge portion of what the workforce was in 2008.
Rutgers may as well have skipped the survey. The same story is told, in slightly different form, in U.S. unemployment statistics. Five percent of Americans have dropped out of efforts to find jobs or are in part-time jobs but want full-time work. The nature of employment in America has changed in three years. There is a permanence in that change, at least as far as many employers are concerned.
Businesses have found that they have more leverage with workers. The threat of job loss is part of the reason. People worried about employment often work harder. Harder work means employers do not need to hire people. If they do add jobs, these businesses can be selective. Part of that process is to add workers who are paid little in comparison to their skills or who work part time and without benefits.
Many believe that once the economy has recovered, unemployment will return to the 5% level where its was in 2005 and job benefits and pay will return as well. That is not likely because of productivity. But productivity does not tell the entire story. Businesses have learned the game of trading full-time workers with high pay and substantial benefits for people who are just happy to have work of any kind. It is another sort of productivity that is devastating.
Douglas A. McIntyre
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