TIME Economy

Report: Low-Pay Jobs Replace High-Pay Jobs Since Recession

A diner sits next to a help wanted sign at a McDonalds restaurant in the Brooklyn borough of New York, on March 7, 2014.
A diner sits next to a help wanted sign at a McDonalds restaurant in the Brooklyn borough of New York, on March 7, 2014. Keith Bedford—Reuters

A new report by the National Employment Law Project finds that unsteady economic recovery has been powered by the replacement of high-earning jobs lost in the recession with low-paying positions in the service industry

Even as the economy has slowly emerged from the worst downturn since the Great Depression, job growth since 2008 has come predominantly in the form of low-wage service industry jobs replacing high-earning jobs lost in the recession, according to a new report.

Although employment rates have roughly reached pre-recession levels, most of the jobs gained since 2008 have been in lower-wage industries, according to a report from the National Employment Law Project. Lower-wage industries accounted for 22% of recession job losses, but are responsible for 44% of the hiring in the recovery. There are now almost two million more low-wage workers than there were at the start of the recession, according to the report.

High-wage jobs accounted for 41% of job losses but have only grown 30% since the recession, and mid-wage jobs made up 37% of job losses but only 26% of recent employment growth. That means there are almost two million fewer high- and mid-wage jobs than there were before the 2008 collapse, according to the report.

After 49 consecutive months of jobs growth, employment levels are roughly back to where they were before the collapse. The growth in low-wage jobs has been powered in part by retail and by the food and beverage industry.

The report focused on the private sector, but local government employment has declined by 627,000 jobs since the recession, with 44% of those losses taken from local education.

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