Seems that service sector job growth means little>>
Chicago-area wages rose 4.6 percent last year, far outstripping the national average, according to data released by the Bureau of Labor Statistics.
But not everyone fared equally.
The winners were white- and blue-collar employees who escaped layoffs. Their average income jumped about 5.5 percent, according to the data, part of the bureau's annual National Compensation Survey.
By contrast, service-sector workers, who constitute the largest and fastest-growing segment of the job market, saw their wages stagnate.
"It's frustrating," said Randy Smith, who has earned $5.15 an hour for the last three years as a temporary employee. "You look at these people with permanent jobs and they're working, and they're talking about the cost of living went up and [they] got a raise. Me, I'm broke at the end of every month."
Service-sector workers--defined as non-professionals who work in such areas as food service, health care and cleaning--suffered the most because they often lack bargaining power in the workplace, economist Jared Bernstein said.
"White-collar workers typically are protected because of their skills. And blue-collar work is pretty unionized," said Bernstein, who works at the Washington-based Economic Policy Institute. "But service-sector workers have very little protection. They're less insulated from market swings, unlike the union folks who are covered by contracts."
More so than in other sectors, service-sector employees are non-union and work part time.
They also constitute the largest segment of the workforce, and fastest-growing. In 2001, the most recent year for which figures are available, 46 percent of employees worked in the service sector, compared with 29 percent in white-collar occupations and 25 percent in blue-collar jobs, according to the Bureau of Labor Statistics.
That growth in the number of jobs has yet to spur an equivalent boost in wages. The average service-sector employee earned $12.21 an hour in Chicago last year, compared with $25.42 for white-collar and $16.93 for blue-collar employees.
Economists warn that stagnating wages in service employment will hamper an economic turnaround.
"This is our largest sector, and if there's no growth it's going to be pretty hard to build a recovery," Bernstein said.
The Bureau of Labor Statistics report was also remarkable for the differences it found among Chicago-area wage growth and the national average. In the country as a whole, wage expansion barely outpaced inflation at 2.6 percent. In the Chicago region, which stretches from Gary to Kenosha, it jumped 4.1 percent.
Paul LaPorte, an economist at the bureau, said that's because financial services--so strong in Chicago--boomed last year along with the flood of homeowners who took advantage of low interest rates to refinance their homes. "Over the year we did see a big increase in the finance, insurance and real estate industries," he said. "And the pay for workers in those industries went up."
At the same time, the growth in wages doesn't account for the roughly 1 million jobs shed since the recession ended in November 2001. Those remaining likely had more seniority and commanded better pay, LaPorte said.
Bernstein said manufacturing wages, in particular, remained strong because so many workers--71,000 in July alone--have been shed from payrolls.
"Those who have stayed are producing at a high rate," he said.
Nationally, forecasters predict that wages will climb at only a modest pace in the coming year. |
