February 11, 2010

A study conducted at Northeastern University's Center for Labor Market Studies has found that low-income workers have been hit the hardest by the recession and employment crisis. On the other end of the spectrum, there has been "no labor market recession for America's affluent." The study stated, "Workers in different segments of the income distribution clearly found themselves in radically different labor market conditions. A true labor market depression faced those in the bottom two deciles of the income distribution, a deep labor market recession prevailed among those in the middle of the distribution, and close to a full employment environment prevailed at the top. There was no labor market recession for America's affluent." According to the study, in the bottom decile of American income distributions, 50% of households are underemployed; in the second lowest decile it's 37%. In the top two income deciles (households earning over $100,000 per year), there is nearly a "full employment environment." Another way of looking at it, the lowest income group (those with an annual household income of $12,499 or less) had an unemployment rate of 30.8% during the fourth quarter of last year. That is more than five percentage points higher than the overall jobless rate at the height of the depression. Whereas the highest group (those that have a household income of $150,000 or higher) had an unemployment rate of 3.2% in the fourth quarter of last year. In the next highest group (those that make $100,000 to $149,999) had an unemployment rate of 4%.

Bob Herbert from the New York Times commented on the study and said, "The point here is that those in the lower-income groups are in a much, much deeper hole than the general commentary on the recession would lead people to believe." (Full Story)