More Jobs, Less Pay
Wisconsin sees the largest month-to-month gain in a decade but most are low-wage jobs.
The good news: Wisconsin had a June jobs surge, a boost from May of 13,800 private sector jobs. State officials rightfully called it the largest month-to-month gain in nearly a decade.
The bad news: Most of the growth—7,200 jobs—was in the “leisure and hospitality” sector, where average weekly pay was only $284 last year. That’s barely one-third the overall average wage in Wisconsin of $803.
What it means: The administration says the numbers “point to a trajectory of economic growth in Wisconsin under Governor Walker’s leadership,” according to the Secretary of the Department of Workforce Development.
But much closer to the mark is the perspective of the state’s bankers. “The economy seems to have reached a plateau,” said the president of the Wisconsin Bankers Association, the day before the jobs numbers came out. “The state economy [is] flat.”
The June jobs report should also be taken with a good deal of caution, as monthly reports by the U.S. Bureau of Labor Statistics are based on a small sample and can be off by more than 9,000 jobs in either direction in any given month for a state like Wisconsin. Leisure and hospitality jobs, moreover, can often be short-term summer jobs, although the data are corrected for seasonal swings.
If June 2013 is compared with June 2012—a year-to-year comparison rather than month-to-month—we ranked 38th among the states in job growth.
Conclusion: The news is mixed at best because most of the growth was in the lowest paid sector of the economy. The Milwaukee Journal Sentinel quoted an economist saying, “Low-quality jobs are better than no jobs.” That may be true for the Walker administration’s boasts, but it’s a terrible way to grow an economy.