The deterioration of the job market is one of the most serious consequences of the Great Recession. Unemployment rates continue to be very high, while the quality of the majority of jobs being created is below that of the jobs lost, both in terms of compensation and benefits.
The trend that existed before 2008 was already unfavorable for a large majority of American workers. The sector had already been hit by the lack of an updated minimum wage and more labor flexibility, the impact of technology and the offshoring of jobsall coupled with the loss of influence of labor unions.
For several decades, work became devalued within the corporate structure. For example, in 1980 it was estimated that a CEO earned 42 times more than an average employee in his company. Today, that pay ratio equals 495 times, according to a Businessweek analysis.
The huge income disparity this causes, coupled with regressive tax policies, is hurting the economic recovery by resulting in weak domestic demandwhether because of a lack of purchasing power or high consumer debt.
One solution is revaluing work. That way, companies won’t be based on the principle that a full-time employee must depend on food stamps so that the company can make record earnings to satisfy its shareholders.
On an individual basis, the knowledge that comes from education is still the best way to have a shot at getting a good job. Access to education and the quality of teaching are usually the determining factors in job opportunities.
A country’s workforce is what holds up its economy. The key for the workforce to be able to produce and consume in a way that helps national growth is its financial stability.