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For Many, A New Job Means Lower Wages, Studies Find - U.s.

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After being out of work for more than a year, Donna Ings, 47, finally landed a job in February as a home health aide, earning about $10 an hour, with a company in Lexington, Mass.

Chelsea Nelson, 21, started two weeks ago as a waitress at a truck stop in Mountainburg, Ark., making around $7 or $8 an hour, depending on tips, ending a lengthy job search that took her young family to California and back.

Both are ostensibly economic success stories, people who were able to find work in a difficult labor market. Ms. Ing’s employer, Home Instead Senior Care, a company with franchises across the country, has been aggressively expanding. Ms. Nelson’s restaurant, Silver Bridge Truck Stop, recently reopened and hired about 20 people last month in an area thirsty for jobs.

Both women, however, took large pay cuts from their old jobs — Ms. Ing worked in the office of a wholesale tuxedo distributor; Ms. Nelson used to be a secretary. And both remain worried about how they will make ends meet in the long run.

With the country focused on job growth and unemployment continuing to hover above 9 percent, there has been comparatively little attention paid to the quality of the jobs being created in this still-struggling economy and what that might say about the opportunities that will be available to workers when the tumult of the Great Recession finally settles. There are reasons, however, for concern, even in the early stages of a tentative recovery that now appears to be barely wheezing along.

For years, long before the recession began, job growth had become increasingly polarized in this country, with high-paid occupations that demand significant amounts of education and training growing rapidly, alongside low-wage, entry-level, service-type jobs that do not require much schooling or special skills, according to David Autor, a labor economist at the Massachusetts Institute of Technology.

The growth of these low-wage jobs began in the 1980s, accelerated in the 1990s and began to really take off in the 2000s. Losing out in the shuffle, according to Dr. Autor, are jobs that he describes as “middle-skill, middle-wage” — entry-level white-collar positions, like office and administrative support work, as well as certain blue-collar jobs, like assembly line workers and machine operators.

The recession appears to have magnified that trend, according to Dr. Autor in a recent paper, released jointly by the Center for American Progress, a left-leaning policy group, and the Hamilton Project, which has a more centrist reputation. From 2007 to 2009, the paper found, there was relatively little net change in total employment for both high-skill and low-skill occupations, while employment plummeted in so-called middle-skill occupations.

A new analysis by the National Employment Law Project, a liberal advocacy group, takes a different approach, identifying industries that have actually experienced job growth in 2010 and examining their median wages. It is a blunter measurement because it focuses on industries, within which there is often great diversity in income. Economists also cautioned that it was still too early to know exactly which sectors would eventually lead the way in a sustained recovery.

Nevertheless, the law project analysis offers a snapshot of where the employment growth has been so far. It found job expansion to this point has been skewed toward industries with median wages that are low to middling, with a disproportionate share of job growth happening in industries whose median wages fall below $15 an hour.

“There’s a striking contrast so far between which industries have lost jobs and which ones are growing,” said Annette Bernhardt, policy director for the law project. “If this kind of bottom-heavy job creation continues, it could pose a real challenge to restoring consumer demand and making sure working families have a way to support themselves.”

Low paid work has to be good news for house prices....

Looks like the polarised recovery.

Still I'm sure it's contained and the debts will be repaid. In the US for the lower income earners income used to be made up by borrowing against the house, now that option isn't available low income households have to live within there means, which will mean lower overall demand.

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