American Workers Are Worse Off, Says Study

September 1, 2008 Updated: September 2, 2008

NEW YORK—As Labor Day comes and goes, we reflect upon the contribution American workers make to our national economy. But a newly released national labor scorecard shows that American workers are in worse shape than before.

The study, released on Monday, was conducted by professors from Rutgers University School of Management and Labor Relations. The report said that nearly 10 percent of all Americans are either unemployed, discouraged from finding work, or underemployed. That’s a 25 percent jump from last year’s figures.

“The economy is the number one issue going into the presidential race, and the scorecard provides a way to look at this area from the perspective of the American worker,” Professor Douglas Kruse, a labor economist at Rutgers, said in a release.

Data released last week by the U.S. Department of Labor showed that applications for unemployment claims declined by 10,000 to 425,000. Figures above 400,000 typically indicate a struggling economy.

“There are many causes of concern, particularly with the sharp decline in the number of Americans able to find full-time jobs, as well as the continued growth in inequality, the sharp increase in consumer debt and growing costs of health care,” Kruse said.

“But there are some bright spots long term: steady improvements in workplace safety; a growing—though still very small percentage—of employers who offer some support for childcare and employee wellness programs; and the fact that more Americans who have jobs are completely satisfied with them.”

Last week, the U.S. Department of Treasury announced $54 million in grants for 89 organizations serving economically distressed communities across the nation. The award recipient organizations are headquartered in 38 states and the District of Columbia.

The federal government hopes that the grant can ease the pressure on working families in less developed communities. The grant is a program of the Treasury Department’s Community Development Financial Institutions fund.

Although federal minimum wage increased significantly this year to $6.55 per hour in nominal dollars, it is still lower in real terms than a decade ago when inflation in factored in, the study announced.

The report also found that the percentage of workers who are working part time, but would prefer to be in full-time jobs has gone up over 72 percent over the last 8 years. Unemployment rates were found to be highest among blacks and Latinos, and their increases in the past year have been greater than those of whites.