Low wage jobs and the increase in non-working America grow: Half of jobs added last month were in low wage fields and those not in the labor force jumped by 354,000.

If we look at the labor force in sheer numbers we find a couple growing themes.  The number of low wage jobs continues to dominate employment growth.  Of course this will only add additional burdens to an already cash strapped young American worker.  Financial pundits would say any job is better than no job.  Speaking of no jobs, the next theme is that of the massive number of Americans not in the labor force.  This number continues to trump any job gains.  For example all the current headlines are saying that the US added 295,000 jobs.  A nice number but where is the headline saying that the nation also added another 354,000 Americans to the “not in the labor force” category overshadowing any net gains in jobs?  The reason this isn’t reported is that those not in the labor force are somehow relegated to the national safe of unreported secrets.  Nearly 93 million Americans are not in the labor force.  The spin is that many are older Americans retiring but the data shows otherwise.  Many older Americans are too broke to retire.  Low wages and exiting the labor force seem to be the continuing trend.

Low wage jobs

Over half of the jobs added last month came in the form of low wage jobs.  Many in the leisure and hospitality industries.  These jobs pay just enough to get by and of course don’t allow people to save for their future.  These jobs will always exist but as your main source of economic growth?  This is why the widening gap of income and wealth inequality is only growing in this country.

Take a look at the employment data here:

jobs quality Feb_0

Leisure and Hospitality, added 66K jobs

Education and Health added 54K

Retail trade added 32K

Retail is also a low wage service sector.  This helps to explain the growing number of people taking out subprime loans to get by.  We continue to see that wage growth is virtually nonexistent.  Well when most of the jobs being added are in the low wage employment sector it should serve as a logical conclusion that overall wages would also be low.  This should be the main focus of the 2016 political campaign.  The public realizes something is going on when housing prices are up yet homeownership rates are down.  They also know something is going on when stocks are near a record peak yet half the country is living paycheck to paycheck.

Not working

Virtually one-third of Americans are not in the labor force.  Last month alone this number grew by 354,000:

not in labor force

The growth of those not in the labor force alone trumps the 295,000 jobs that were added (half in low wage jobs).  Add all of this up and you can see why many Americans feel that the middle class is shrinking.  They feel it because in reality it is.  You can’t have a healthy recovery when the bulk of jobs being added are low wage jobs.  Low wages really don’t help the millions of young Americans with massive college debt.  It is always important to understand the numbers behind the headlines since they tell a much more complete story.

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