In recent decades, the U.S. labor market has undergone rapid changes. From salaries to demographics, everything has shifted dramatically.
Many experts have remarked that today’s problem with the U.S. labor market is a shortage of available labor that is willing and able to work, not a lack of jobs.
Let’s have a look at what has and has not changed.
The Top 10% Have the Lion’s Share
An Economic Policy Institute study found that the top 10 percent of the American workers take home about 53 percent of the total market-based income. That income share has risen from 42 percent since the late 1970s.
Median Salary
An average American worker in 2020 earned $957 per week, or $49,764 annually, before taxes. This is a hike of 5.7% from 2019.
Managers, professionals, and related occupations earned an average of $70,044 per year. The median annual pay of workers in the service industry was $44,122.
According to U.S. Department of Labor statistics, a male worker’s average salary was $55,432, while a female worker earned only 80.4% as much as her male counterpart. More than 76 million women form 47% of the U.S.’ total workforce.
As per an employer survey, the last decade saw Asian-American full-time workers’ income exceed most U.S. workers. In 2018, Asian and White individuals earned an annual average income of $87,194 and $70,642. Latino and Black individuals, meanwhile, earned $51,450 and $41,361, respectively.
Among U.S. states and territories, the District of Columbia has the highest median income of $82,604. At the same time, West Virginia has the lowest at $44,921.
Workforce Fluidity
The U.S. has one of the highest rates of workforce fluidity in the world. Workforce fluidity measures the rate at which workers move in and out of unemployment, change jobs, change their location for jobs, etc.
However, over the years, researchers have found a decline in U.S. labor market fluidity. They are not yet congruent on the reason for the fall, but some studies are linking the fall to more people turning toward self-employment.
North Carolina has the lowest decline in labor fluidity, and Arkansas has the highest.
Changing Workforce
The American workforce is changing demographically, as well. America’s future labor force is expected to be increasingly female, as well as racially and ethnically mixed. The projections suggest that it will be older than the current one. The shift in the labor market is the result of increased participation of young people and older people, combined with changes in education, healthcare, and other factors, according to the U.S. Census Bureau.
Adult participation in the American labor force below the age of 55 has decreased over the years. At the same time, the number of workers above 55 years of age has increased.
Areas That Will Have the Largest Labor Growth
Computer, math, and science occupations are expected to grow faster between 2020–2030. The number of jobs for doctors and technicians is also increasing. However, the number of new jobs for the former could be higher in absolute terms than for the latter.
About a quarter of the net job growth is expected to be found in the healthcare industry, which is projected to grow by nearly 20 percent over the next decade. According to the Bureau of Labor Standards, other health professions—including medical assistants, physiotherapists, and nurses—are expected to be among the fastest-growing careers.
Dwindling Trade Unions in the U.S.
With union membership shrinking in the ever-changing economy, the unions’ days of influence are over.
Between 1983 and 2015, the number of trade union members shrunk to almost 1.5 million from nearly 4 million. The decline comes despite the addition of more than 45 million new members to the workforce.
Robots and Future Workforce
The fear of technology replacing humans has always been there. Will it be different this time? Robots and AI are quickly taking over for humans in factories, halls, and offices.
A Massachusetts Institute of Technology study released recently calms those fears. The researchers of the study expect more jobs to be created than can be filled by workers. They conclude the changes would be evolutionary rather than revolutionary.
What happens in the U.S. affects the whole world. The world’s largest economy is the forerunner of the business world. The reports coming from the best will soothe the frayed nerves of the American dreamers.
