Katherine Wise

Decreasing unemployment, increasing service jobs

The unemployment rate is steadily decreasing. As of April 2013, the national rate is 7.5 according to The Bureau of Labor Statistics, but many increasing jobs are low-wage.

We are already in what’s called a service economy,” said Dianne Finch.

Finch, a visiting Business Journalism professor at Elon University, worked for Bloomberg and has written stories about the economy.  She said she follows unemployment rates for economic journalism purposes as well as for her own sake.

The Employment Situation Survey from the bureau indicated job growth occurred in food services and retail trade, as well as business services and health care.

Katrina Boddy, 20, knows the service sector well.

“I have worked four minimum wage jobs,” Boddy said. “Two in retail and two in food.”

Boddy said the wages she earns in service jobs make it difficult to make end meet, especially since she is also a student at Alamance Community College.

“I need help from my parents due to the fact that I don’t get paid enough at my job to cover everything,” Boddy said. “I probably could scrape by if I wasn’t in school, but I am in school.”

She currently works at Panera, where she earns 7.25 per hour, which is the minimum wage in North Carolina. At one point, Boddy said she was working three service jobs at once. She said she tries to pay the majority of her bills. Despite Boddy’s current paycheck, the bureau’s survey indicated that the average hourly wages up .4 percent in April 2013.

“It is harder to get a high paying job because of the market, and you have to sell yourself a lot more,” Boddy said.


Employment in food services increased 38,000 in April, which is 13,000 more than the average job growth of 25,000 food services jobs the past 12 months.

Jobs in retail increased by 29,000. Carlos Cruz, who works and Step N Style in Holly Hill Mall, has not seen an increase in employees, but he said the store still benefits from the increase in employment.

Over all, it’s like a cycle. You see a little growth and a little people got a little bit of extra money to spend,” Cruz said.

Rajesh Wadhwani, the store’s owner, said the business targets blue-collared workers, so an increase in service jobs should help the industry. While he said he has not noticed a large increase this month, he said the business has seen a steady increase in sales since the economic downturn in 2008.

But Wadhwani is concerned about the widening economic gap.

“Big companies, like corporate, they are growing. They are collecting all the money, ” Wadhwani said.

Wadhwani is originally from India, where he said the economic gap is very wide. He is worried a similar trend is occurring in the United States.

“I’m kind of scared, because my kids are growing here, and I don’t want them to face the same issues,” Wadhwani said.

According to the a report from the Congressional Budget Office, between 1979 and 2007, the income grew by 275 percent for the top 1 percent of households, and 18 percent for the bottom 20 percent of households.

 

Boddy said service jobs are not hard to obtain, and she said she is not surprised that the unemployment rate is decreasing.

“I would be surprised if you told that people were getting great paying jobs,” Boddy said.

According the bureau, the unemployment rate has decreased .4 percent since Jan. 2013.

But Finch said that one number is not reflective of unemployment as a whole.

“You can never just look at the unemployment rate itself,” Finch said.

She said it is important to look at unemployment rates by demographics, such as age and gender. For example, the Bureau of Labor Statistics reported that in April the unemployment rate decreased by 6.7 percent for women. Additionally, the unemployment rates vary state by state. North Carolina has the fifth highest unemployment rate in the United States.