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These numbers just keep on getting worse for the average worker.
Jared Bernstein and Heidi Shierholz at the Economic Policy Institute write:
On average this year, payrolls have contracted by 66,000 per month. Job loss in the private sector has occurred more quickly, however, dropping an average of 83,000 jobs a month since it peaked in November 2007. Private sector payrolls are down 665,000 since then, including the loss of 76,000 last month. Since government employment is less sensitive to the business cycle, the private sector losses are more indicative of the full extent of labor market weakness.
This persistent and deepening slack in the job market, in tandem with accelerated inflation, is leading to significant real wage and benefit losses for most workers. Average weekly hours slipped slightly last month to 33.6 hours per week, the lowest level since November 2004. This put downward pressure on weekly earnings, which rose 2.8%, before inflation in July, the same rate as the previous month and the slowest pace of weekly earnings since September 2005. With inflation running between 4-5%, the buying power of weekly paychecks is dropping sharply.
In a related release yesterday, the BLS reported that the Employer Cost Index—a comprehensive measure of average wages and benefits—fell 1.8% in real terms in June 2008 compared to June 2007. That is the largest real decline in this data series’ history (dating back to the early 1980s).
Along with the decline in weekly hours worked, another important sign of the extent to which our current workforce is underutilized is the increase in part-time workers who would prefer full-time jobs. In July, there were 5.7 million part-timers in this category, 1.4 million above last year’s level and the highest level since the BLS settled on a way of measuring this condition in 1994. Since these involuntary part-timers are included in the underemployment rate noted above, they are partly responsible for its spike last month.
Meanwhile, as Chye-Ching Huang and Chad Stone at the Center for Budget and Policy Priorities noted in a new analysis on Wednesday:
Average pre-tax incomes in 2006 jumped by about $60,000 (5.8 percent) for the top 1 percent of households, but just $430 (1.4 percent) for the bottom 90 percent, after adjusting for inflation, according to a new update in the groundbreaking series on income inequality by economists Thomas Piketty and Emmanuel Saez. Their analysis of newly released IRS data shows that in 2006, the shares of the nation’s income flowing to the top 1 percent and top 0.1 percent of households were higher than in any year since 1928. ...
