Press Release | Devastating Job Quality Report Shows Lower Quality Jobs Took Biggest Hit

May 08, 2020

20.5 million U.S. jobs lost in April

Washington. Today’s jobs report shows a drastic collapse in overall U.S. employment. A record 20.5 million jobs were lost in April, propelling the nation’s unemployment rate up to 14.7 percent, a new post-World War II high.

This morning’s “JQ-Instant” indicator, published by the Coalition for a Prosperous America (CPA) and others, showed that 79.27 percent of the jobs lost in April were “low quality” (defined as having a mean weekly income below the national average). The leisure and hospitality sector accounted for 7.7 million of them. Education and health services shed 2.5 million jobs. But higher-tier job losses abounded as well. Manufacturing lost 1.3 million jobs in April. And professional and business services declined by 2.1 million jobs. 

CPA’s Chief Economist Jeff Ferry, said, “The 20.5 million job loss number is an historic, truly awful, and unprecedented figure for a single month. The fact that service sectors like leisure and hospitality took the largest hit illustrates that low-quality jobs not only pay relatively poorly and in most cases offer inferior benefits, but they’re also highly insecure positions. That's why future economic recovery measures should focus on creating high-quality jobs and the industries that support them.”

The monthly U.S. Private Sector Job Quality Index (JQI) issued by the Coalition for a Prosperous America (CPA) and its partners fell slightly to 79.11, down by 0.16 percent from its revised level one month earlier. This paradoxical result arises because the JQI measures a mix of production and non-supervisory jobs in the U.S. economy. In the January to March period, the mix shifted slightly in favor of low-quality jobs, defined as jobs paying less than the mean weekly income for all production and non-supervisory workers.

Next month’s Job Quality Index is likely to rise dramatically. This does not mean that the economy is improving, but rather that as all sectors lose huge numbers of jobs in the COVID crisis, the mix of jobs will shift in favor of remaining, higher-quality jobs—since they are more secure than low-quality service employment. 

Michael Stumo, CEO of the CPA, said, “The trends in our Job Quality Index clearly show that we must increase the quality of employment in the U.S. toward more job security and family financial stability. Washington needs to implement an aggressive ‘Made in America 2030’ program of infrastructure and industrial strategy as the basis for post-COVID economic recovery. The priority should be to rebuild our manufacturing sector, restore good-paying jobs, and regain self-sufficiency in vital sectors like medical supplies and pharmaceuticals.” 

Read more about a ‘Made in America 2030’ plan to rebuild economic and national security.

Read more about the U.S. Jobs Quality Index and the JQ Instant.

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  • Ben Leet
    Half of U.S. workers, 83 million, earn on average less than $15,000 a year is the finding of the Social Security Administration’s report on wages, 2018. -- https://www.ssa.gov/cgi-bin/netcomp.cgi?year=2018 - The top earning for the lower half was $32,838.05, called the median wage income for 167 million workers. The lower half, 83 million, can be divided into 3 equal parts: the lowest earning part earns less than $7,500 (with an average of $2,500 yearly), and then combining the next two parts those workers earn a median of $19,000. The $19,000 comes from a Brookings report Meet the Low-Wage Workers. I find that the JQI lacks a certain detailedness as to actual income. It gives the impression that the median, which is around $43,000 a year is the norm for the lower earning 55% of private sector workers, which is incorrect. I wish the authors would also report the median incomes for the “above median” and for the “below median”. The lower-earning half, 83 million workers, earn in wages less than 8% of the national income, about $1.2 trillion. Total national income is around $18 trillion says the BEA, and the Congressional Joint Committee on Taxation places total at $15.6 trillion for 2019. The JCT shows that 49% of households earned 13.0% of taxable income. I’m not content with that summary; the JCT shows that the lowest earning 49% (85 million tax units) earned $2.03 trillion or an average of $23,822 in 2018. (Half of 128 million total U.S. households is 64 million, 85 is 66% of 128.) Which I regard as very low income households. The JQI reflects a greater income than the actual income for the lower half, is my contention. The JQI is a very valuable metric as it is. Since 1990 62% of new jobs have been below the median annual income for private sector workers, I think that was the finding of the JQI original report. Dan Alpert, I hope he reads my comment, I admire his work above many many others.
  • Jeffrey Sunnergren
    The idea of a JQI as defined by Coalition for a Prosperous America is a very ignoring measurement. As you know, Boeing hired software engineers to write the MACS (I just love acronyms) and paid them, according to Bloomberg news, as low as nine dollars per hour. Certainly your JQI, jobs you would classify as low quality jobs. Your definition as low quality is disgusting. Older technical people (over 40) are the first to go and pay raises become less and less.
    You see, technical people over 40, become dumb and can’t see new ideas which is why our tech firms (Google, Facebook, Amazon, Microsoft) only hire young foreign students on some sort of visa. The jobs that were lost were jobs that people must preform everyday because they are labor intensive jobs. So who ever believes this must sit in a easy chair, smoking a pipe, and blowing smoke rings.