A Quarter Of Jobs In America Pay Below The Federal Poverty Line

By Libby Schauer

It’s not up for dispute that unemployment has been in critical condition for the past few years. With hundreds of thousands of Americans jobless, getting people back to work was and still remains many people’s number one priority. This task is not as simple as it sounds, as it has proven, and as a result many of the jobs people are finding and taking are low-wage, temporary jobs. Because the labor crisis has been occurring for such an extended period of time, zerohedge.com is calling the shift from full-time to part-time jobs the “New Normal”.  But is this really what America needs? The answer is no. 

Now, I’m not saying that working a job that pays minimum wage while out of work or searching for a quote on quote better job is necessarily a bad thing. Both of my parents faced unemployment at different times in 2011 and to help counteract that my dad worked 2 part-time jobs. The paychecks weren’t much, but it was better than him just sitting at home and doing nothing. The key to my dad’s story is that he worked the basic jobs he could while applying for jobs that utilized his college degrees. And that hard work paid off, because he now has a job that fits all of his qualifications. The problem would have been if he accepted his “shift from full-time to temp, or part-time labor, with virtually no contractual or welfare benefits, and where workers are lucky to get minimum wage”. The new focus has shifted from quality of jobs to quantity of jobs. And any economist knows that quality is far more important than quantity (all things equal). Can American’s live off of this new lifestyle? Again, the answer is no. 

Below is a chart that shows the enormous spike of unemployment Americans have faced since 2001. 

Clearly, something needs to be done. But not just about the quantity of jobs, but the quantity of quality jobs. Employment spiked considerably through 2008-2009, and has yet to drop below the 7.7%-8.0% range. Today, February 1^st, according to the Los Angeles Times  unemployment is at 7.9%, but in January of this year the economy added 157,000 jobs. So what kind of jobs were these? Taken from Zero Hedge is an excerpt they used from the New York Times that states, 

“How did we arrive at this state of affairs? Many argue that it was the inevitable result of macroeconomic forces — globalization, deindustrialization and technological change — beyond our political control. Yet employers had (and have) choices. Rather than squeezing workers, they could have invested in workers and boosted product quality, taking what economists call the high road toward more advanced manufacturing and skilled service work. But this hasn’t happened. Instead, American employers have generally taken the low road: lowering wages and cutting benefits, converting permanent employees into part-time and contingent workers, busting unions and subcontracting and outsourcing jobs. They have done so, in part, because of the extraordinary evangelizing of the temp industry, which rose from humble origins to become a global behemoth.”

The solution to this may not be as hard as it is perceived however. People need to get off the couch,  learn a skill, and specialize in that skill that will help them get a better job, and therefore help stimulate the economy as a whole. If a quarter of jobs in America pay below the federal poverty line for a family of four ($23, 050), I think that may be at the root of all of America’s unemployment problems. The labor market and job sector have huge repercussions on the health of the economy, and while 4% unemployment can and is an acceptable figure for employment, a steady rate of around 8% for years is something that American’s can’t take any longer. And the quality of jobs that they’re having to succumb to are hurting them as well. 
Durden, Tyler. "A Quarter Of Jobs In America Pay Below The Federal Poverty Line." Zero Hedge. N.p., 30 Jan. 2013. Web. 01 Feb. 2013.

Thompson, Alasdair. "New Unemployment Figures: Good News?" Bright Green. N.p., 18 Mar. 2011. Web. 01 Feb. 2013. 

Puzzanghera, Jim P February. "Economy Added 157,000 Jobs in January; Unemployment Rate up to 7.9%." Los Angeles Times. Los Angeles Times, 01 Feb. 2013. Web. 01 Feb. 2013.