September 6, 2013
The sharp rise in retail employment and restaurant work in the latest jobs report continues the pattern where low-paying sectors show the most rapid growth. While some have argued that this is due to technological changes, the data suggest that a weak labor market is forcing people to take bad jobs. This is seen by the correlation between state unemployment rates and the growth in the share of restaurant jobs. Also, wage growth has been less rapid in the restaurant sector than elsewhere (0.6 percent over the last year in restaurants compared with 1.9 percent overall), the opposite of what would be expected if technology was behind a relative increase in demand for restaurant workers.
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