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New Cornell Report: U.S. Job Quality Sinking in Last 30 Years

Posted By Isaac Nuriani |


There is a dark truth lurking behind the exceptionally low U.S. unemployment rate. It has hovered right around the 4% mark for roughly two years. In fact, since February of this year, the unemployment rate has been at 3.8% or lower. Last month, it sat at just 3.6%. That sounds awfully good. Many experts see consistently low unemployment as the single best indicator of an economy’s strength. However, when it comes to the employment picture in America today, looks can be deceiving.

One problem is that the “official” unemployment rate quoted by the government is incomplete and therefore presents an inaccurate picture of real unemployment. But there is an even bigger problem. According to a new report, the significant majority of nonsupervisory jobs created in America over the last 30 years offer low wages and limited hours.

An economy that can’t produce enough jobs with more than minimal wages and hours is likely to lead to a multitude of negative consequences – especially with the baby boom generation now transitioning to retirement and taking their longstanding positive impact on the industrial economy with them. But even before the effect of these consequences becomes profound for the nation, the “hidden” jobs reality suggests right now that a major recession is just around the corner. Prudent retirement savers would be well-advised to act now and configure their portfolios for resiliency.

“An Overabundance of Low-Quality Service Jobs”

There’s more evidence that what we see is not reality. Despite two-plus years of an unemployment rate right around 4%, nearly half of American families cannot afford the basics. Again, it appears one big reason is that so many of those who are employed today are toiling in jobs characterized by limited hours and low pay.

In a recent article, The Hill breaks down the key points of a new Cornell Law School white paper titled “The U.S. Private Sector Job Quality Index.” The Cornell report shows Americans have been losing personal economic ground in part because the country seems capable of creating only subpar jobs.

As a metric, the Job Quality Index (JQI) represents “the degree to which the number of jobs in the United States is weighted towards more desirable higher-wage/higher-hour jobs versus lower-wage/lower-hour jobs.” The higher the figure, the more “higher-wage/higher-hour” jobs there are in the U.S.

The metric has been falling steadily since 1990, from 94 to 80, but the measurement itself doesn’t mean a whole lot to a layperson. What is important are the determinations made from the research as to why the JQI has been on a 30-year downslope.

The broad conclusion, as The Hill puts it, is that the nation has created “an overabundance of low-quality service jobs.” For example, the 15 million nonmanagement jobs that now exist in the leisure and hospitality industry provide workers with just 24.6 hours each week at an average hourly wage of $14.65. Those numbers translate to a weekly paycheck of only $360.

The average profile of the 13.5 million nonmanagement retail jobs out there now is a little better, but hardly robust: 30.3 hours a week at $16.73 per hour, for a weekly check of $506.

Morning Consult notes that through 2018 there were 105 million production and nonsupervisory jobs in the U.S. That figure represents roughly 81% of all jobs that currently exist in the private sector. According to The Hill, 55% of those jobs send their workers home with weekly paychecks less than the national average of $793.

As for the aforementioned 4% unemployment rate, it unfortunately does a good job providing cover for the job-quality problem. The official rate you regularly hear quoted accounts only for those who are out of work and have actively looked for work in the preceding month. The figure does not include those who’ve stopped looking for work after a month of searching – often referred to as the “short-term discouraged.” The figure also neglects the “underemployed,” defined as those working at part-time jobs because that’s all they can find, or those who are plugging away at jobs far beneath their experience and credentials because that’s all they can find.

The “short-term discouraged” and underemployed are included in the rarely-cited U-6 unemployment rate, which is currently at 7.2% according to the Bureau of Labor Statistics. However, there remains a category of unemployed American no longer even counted by the Bureau of Labor Statistics: the “long-term discouraged,” defined as those out of work for a year or more. According to the website, which claims to provide “analysis behind and beyond government economic reporting,” a comprehensive unemployment rate that includes the long-term discouraged presently would be at a whopping 21%.

Gold and Silver Can Help Protect You from the Real Economy’s Fallout

Being a savvy retirement saver means tuning out the noise of soaring (read “overvalued”) financial markets and disingenuous unemployment figures and focusing on real – and revealing – data. Numbers and trends indicating continually diminishing job quality in America are examples of such data. So are figures that more accurately reflect the unemployment situation in America than the U-3 rate we’re spoon-fed each month by the government.

When you do focus on real data today, one conclusion you might come to is that portfolios should be configured for safety as much as for growth. And one way to help secure your portfolio is by making sure you’ve included genuine safe-haven assets such as physical gold and silver among your holdings.

If you have little familiarity with owning physical gold and silver, you surely have a lot of questions. For straightforward answers, call Augusta Precious Metals at 800-700-1008 and speak with one of our knowledgeable and friendly gold and silver professionals. You will be gratified to learn how easy it is to buy physical precious metals for your savings, including for an IRA.

A focused look at the economy – including the condition of jobs and unemployment – suggests we could be in for a rough ride over the next decade or longer. A silver and gold IRA offers the potential to help insulate your retirement savings from the effects of the recession predicted now by roughly three-quarters of economists. Let Augusta Precious Metals show you how easy it is to open your own silver or gold IRA.

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