The State of Working America

Speakers: Heather Boushey, Ph.D., Economist, Economic Policy Institute
Richard Clinch, Director of Economic Research, Jacob France Institute, University of Baltimore

Although the strong economy of the 1990s lifted the economic fortunes of working families for the first time in decades, the current recession has lead to a dramatic increase in unemployment, and job growth is stagnant at best. These findings are part of The State of Working America 2002-2003, a report by the Economic Policy Institute, a Washington, D.C.-based nonprofit think tank. Released biennially, The State of Working America examines the impact of national economic trends on the lives of working families.

Report co-author Heather Boushey, an economist with EPI, presented the findings of the report at a forum co-hosted by the JOTF and Open Society Institute – Baltimore. Dr. Boushey said that one lasting legacy of the 1990s appears to be strong productivity growth, which has meant that wages—although growing slowly—are still outpacing inflation. While this is some comfort for those who remain employed, she warned that a jobless recovery will lead to wage stagnation, higher poverty rates, and rising inequality.

“The jobless recovery that we are in right now is leading to lower wage growth and lower income for American families,” says Boushey. “We need to construct a policy response in Washington to deal with that.”

Other findings of the report include:

  • The labor market recession, which began in October 2000 remains with us.
  • This recession marks the end of the long economic boom of the 1990s, which brought the first, broad-based increase in wages and incomes in decades.
  • Low-wage workers especially benefited, as poverty rates dipped to historic lows.
  • The 1990s also brought, however, substantial increases in household debt.
  • The long-term trend towards increased hours of work continues and having a “working mom” remains a salient fact of American family life.
  • University of Baltimore economist Richard Clinch provided a local perspective on the report’s findings. He said that it is important for Baltimore City to ensure that workers are trained for jobs in growing industries such as biotechnology.

“If you don’t create the programs to train the workers for the companies that are coming, the workers will just come from the suburbs,” he said.

He emphasized, however, that Baltimore has seen improvements in the placement of low-skill workers. For example, the city’s job gap has decreased from 2.9 candidates for every low-skill job in 1997 to 1.8 candidates in 2000. Mr. Clinch recommended that the City capitalize on these improvements by increasing opportunities for worker education and training, and by expanding the region’s mass transit system so that workers will be able to access jobs in the suburbs.

View Heather Boushey’s Power Point presentation on The State of Working America.

Order the full report from the Economic Policy Institute.

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