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Middle-Wage Jobs Are on the Decline

DEED finds “job polarization,” despite a low unemployment rate.

Middle-Wage Jobs Are on the Decline

Minnesota’s unemployment rate dropped to a seasonally adjusted 3.2 percent in February. The state’s jobless rate hasn’t been that low in more than 17 years—since August 2000, according to the Minnesota Department of Employment and Economic Development. Available jobs now outnumber unemployed people.

While this would appear to be great news for jobseekers, those numbers obscure some troubling signals. The state’s strongest job growth is in low-wage (under $28,030 annually) and high-wage ($62,840 or higher) jobs. Salaries at the high end are bolstered by technology-related jobs. Middle-wage, middle-class jobs are in decline.

The phenomena, nothing new to economists, is called job polarization. DEED labor market analyst Dave Senf crunched state employment numbers from 1999 to 2016 and found that Minnesota mirrors a national trend. Combined, the number of jobs in the middle-wage categories declined by 4 percent in the 17-year window.

Some employment categories highlight the larger trend: manufacturing jobs declined 9 percent from 1999 to 2016, as did office and administrative support jobs. “A lot of [clerical tasks are] being replaced by technology,” says Senf. “It’s not just the globalization, it’s also automation in the manufacturing sector.”

Senf’s study notes “the job polarization trend identified here is a major source of the rise in income inequality.” But Senf cautions the data should be studied in more detail. Hopefully that will be a future job for humans.

Jokes Senf: “Someday you may be calling and talking to a robot doing my job."

 

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