Bill Knight column for Mon, Tues., or Wed., Aug. 10, 11 or 12
New applications for unemployment benefits fell in July, according to the U.S. Labor Department. But it also reported that wages and benefits this spring grew at the slowest rate in 33 years – more proof that even supposedly stronger hiring isn’t improving paychecks for most of us.
The government’s Employment Cost Index – which tracks wages, salaries and benefits, together – rose just 0.2 percent in the quarter ending June 30, the Labor Department said on July 31. Wages and salaries alone also went up the scant 0.2 percent. Both figures were the smallest quarterly gains since the second quarter of 1982.
As far as downstate Illinois, the area continues to struggle, according to the state Department of Employment Security (IDES). In fact, metro Peoria was found to have the nation’s second-largest decline in employment in May, the Labor Department added last month, losing 2,500 jobs that month – one of 36 U.S. markets that declined. Five areas were unchanged but 346 of 387 metro areas studied showed improved unemployment rates.
Nationally, initial claims for jobless benefits fell 26,000 to 255,000 for the week ending July 18, Labor’s Bureau of Labor Statistics (BLS) reported – the lowest unemployment level since 1973. The most recent U.S. unemployment rate was 5.3 percent – an improvement from May of 0.2 percent (again, that whopping two-tenths of 1 percent).
But, again, many downstate counties’ jobless rates aren’t very good. For example, Fulton’s is 6.9 percent, Henry 5.2, Knox 5.2, Livingston 4.9, McDonough 6.5, Mercer 5.0, Peoria 6.2, Tazewell 5.5, Warren 4.8 and Woodford 4.3, IDES reports.
“Collar counties gained more net jobs than the total statewide gain,” explained IDES Director Jeff Mays. “Given the statewide gain of 44,500 jobs total, the rest of the state had a net loss. The need for a full statewide recovery remains.”
Economist Dean Baker of the Center for Economic and Policy Research said all of the the statistics hide – maybe reveal – a sluggish recovery.
“The job growth [in June] was almost entirely in the service sector,” he said. “Construction employment was flat. The mining sector has lost 51,000 jobs over the last year largely due to the plunge in energy prices. Manufacturing has added just 37,000 jobs through the first six months of 2015, due to the impact of the stronger dollar.
“The retail sector continues to be strong,” he added.
“One positive is that the number of people voluntarily working part-time rose sharply even as involuntarily part-time employment fell,” he continued. “At the same time, involuntary part-time employment is down by 1.6 million (20.0 percent) over this period. This is undoubtedly due in large part to the Affordable Care Act, which freed workers from the need to get insurance through their employer.”
Meanwhile, those wage numbers are disappointing, if not alarming. Median weekly earnings, when taking inflation into account, on June 30 were $308 in what the BLS calls its “constant” or “real” dollar figure, which considers the Consumer Price Index’s effect since 1982, based on a $100 wage then.
The $308 figure also was the median weekly earnings level on June 30, 2013 – a measly dollar better than Dec. 31, 2009. Big whoop.
“This report gives little hope for an uptick in wage growth,” Baker said. “Among major industry groups, the only one that shows much evidence of an acceleration in wage growth is restaurants. This is likely to due to the effect of minimum wage hikes in many states and cities.”
Employers are hiring people who are so desperate to work, companies need not boost pay to attract or keep workers.
So people get jobs but still struggle.
The economy’s not working any better than Springfield politics.
[PICTURED: Great Depression billboard from the early 1930s.]