Wednesday, April 2, 2014

Working in America - It's Not What It's Cracked Up To Be

As shown on this graph, even though the jobs lost during the Great Recession have not been replaced, the economy has created a significant number of jobs since February 2010:

That said, what jobs make up the American workforce, which occupations get paid the most and least and what sectors are creating the most jobs?  The recent Occupational Employment Statistics (OES) from the Bureau of Labor Statistics provides us with insight about America's current employment status.  Here are some interesting facts:

The largest occupational groups and their percentage of the workforce are as follows:

Office and administrative support - 16 percent of total employment
Sales and related occupations - 11 percent of total employment
Food preparation and serving - 9 percent of total employment

The highest paying occupational groups and their mean annual salary are as follows:

Management - $110,000
Legal - $99,620
Computer and Mathematical - $82,010
Architecture and Engineering - $80,100

Please note that CEOs that made up 0.2 percent of all American workers and had a mean annual salary of $178,400, lawyers and judges that made up 0.5 percent of all workers had a mean annual salary of $128,070, in both cases, substantially higher than the overall mean for their respective occupational group.  As well, petroleum engineers who make up only 0.02 percent of all workers and a very small fraction of architects and engineers had a mean salary of $149,180, well above their peers.

The lowest paying occupational groups and their mean annual salary are as follows:

Food preparation and serving - $21,580
Farming, fishing and forestry - $24,330 
Personal Care and Service - $24,710
Building and Grounds Cleaning and Maintenance - $26,010
Healthcare Support - $28,300
Transportation and Material Moving - $33,860
Office and Administrative Support - $34,900
Production - $34,930
Sales - $38,200

All of these occupations have annual mean pay that is well below the nationwide mean of $46,440 annually.  In the case of food preparers, fast food cooks fare the worst with an average hourly wage of $8.88 per hour or a mean salary of $18,870 annually.  In total, 10.9 million Americans or 8.2 percent of all American workers are making less than an average of $10 per hour working in the food preparation industry.  While, on average, sales workers are not doing too badly, retail sales workers who make up 61 percent of all sales workers are having a tougher time, with 8.5 million of them making an average of only $9.58 per hour or $20,450 annually.

Here are some more facts from the OES:

1.) The ten largest occupations:  These occupations include mainly service workers; retail salespeople and cashiers, food preparation and serving including fast food, general office clerks, waiters and waitresses, customer service representatives and registered nurses.  All-in-all, 21 percent of total employment in the United States are made up of workers in these fields, few of which pay well and most of which (excluding registered nurses) are highly impacted by the ups and downs of the economic cycle.  All one has to do is consider the number of layoffs in the retail sector in recent months to see how unstable employment can be for service workers.

2.) Wages for the ten largest occupations: Annual mean wages range from $18,800 for combined food preparation and serving occupations to $34,000 for secretaries and administrative assistants (excluding legal, medical and executive).  This is well below the average United States all-occupations mean of $46,440 annually or $22.33 per hour.  The only occupation in the top ten largest occupations that pays more than the mean is for registered nurses who make an annual mean wage of $68,910.

As I mentioned at the beginning of this posting, we all know that the economy is creating jobs.  From the BLS, let's look at what types of jobs were created in over the past year according to the February 2014 employment report:

Total non-farm jobs created - 3,587,000
New food services jobs created - 609,000 or 16.98 percent of the total
New retail trade jobs - 569,000 or 15.86 percent of the total

In other words, of the 3.587 million new jobs created by the economy between February 2013 and February 2014, 1.178 million or 32.8 percent of the total were created in jobs that are in the lowest paying sectors of the economy.  In addition, 324,000 jobs were in the "Temporary Help Services" classification and 726,000 were in the low-paying "Administrative and Support Services" sector.  That makes a total of 2.228 million low-paying jobs created or 62 percent of the total jobs created in the year between February 2013 and February 2014.

While more Americans are back at work since the depths of the Great Recession, more Americans are working at poor paying jobs since the economy seems quite adept at creating subsistence level service jobs.  That is, in large part, why the latest recession never ended for millions of Americans who, while they are employed according to the exacting and theoretical standards set by the BLS, are unable to afford to stimulate the economy through consumption of both goods and services.


  1. Thank you for this information. This is exactly why alot of things are going to get worse less money is swirling around and its only staying at the top in the hands of just a few people.

  2. Slanted is all this new job pay vs current median pay different then 10, 20, or 30 years ago? Why no comparison to that?

    62% of the new jobs created pay what up to half of all current jobs pay. That's not horribly skewed.

    New where people haven't filled them long enough to get raises, bonuses, COLA's, etc. that current job holders already have and help set the median. Not quite apples to apples.