Prosperity Watch Issue 59, No. 2: Lack of construction and manufacturing jobs holding down NC wages

The forces holding down wages are legion, but one of the main culprits is the lack of robust job growth in industries that pay middle-class wages. Here in North Carolina, manufacturing and construction jobs are still much harder to come by than before the Great Recession, and the absence of those good-paying jobs is undermining wages across the board.

As shown above, manufacturing and construction employment remains depressed compared to where it was on the eve of the recession. Manufacturing provides 70,000 fewer jobs in North Carolina than before the recession, and construction is still down over 60,000 positions. These losses are particularly problematic because both manufacturing and construction pay above average wages. While the average weekly wage in North Carolina was $863 in the third quarter of 2015, construction paid $905 a week and manufacturing employees took home an average weekly check of $1,053.

Construction and manufacturing job losses can devastate families that rely on those paychecks, but the negative effects are visible across the entire North Carolina economy. When jobs in these industries disappear, entire communities can suffer. Because these jobs typically pay above average wages, their loss can reduce hiring in consumer industries like retail and housing. In addition, losing good-paying jobs can undermine wages because employers don’t have to compete to keep workers.

At least some elected leaders are starting to recognize that wage stagnation is a major problem that won’t go away on its own. As long as we continue to replace middle-class careers with low-paying jobs, North Carolinians will struggle to make ends meet and boost the economy.
 

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