The U.S. economy is the largest in the world, but the great sums of income that the American labor force generates, and the employment opportunities the economy affords, are distributed unevenly among its workers. This subject area focuses on trends in wages earned by differently compensated workers, variable rates of unemployment across cities and regions, and other labor force characteristics of workers in metropolitan America. Findings on work include:
- Nationwide, wage inequality grew in the 2000s. From 1999 to 2008, the inflation-adjusted earnings of high-wage workers grew by 3.4 percent. This occurred while hourly earnings for middle-wage workers fell by 4.5 percent and the wages of low-wage workers fell by an even greater 8.3 percent.
- In half of the 100 largest metropolitan areas, high-wage earners saw their wages grow, while middle- and low-wage workers experienced declines. Most large metro areas had wage growth at the top and often at the midpoint of their wage distributions, but in only five metropolitan areas—Cape Coral, Jacksonville, Providence, New Haven, and Virginia Beach—did wages grow for high-, middle-, and low-wage workers.
- Earnings inequality rose more sharply in the 100 largest metro areas than in the nation overall. All but three metro areas—Augusta, Syracuse, and Tucson—posted increases in their high- to low-wage earnings ratios. By 2008, five states accounted for 17 of the 20 large metro areas with the highest earnings inequality. Eleven (11) were located in either California or Texas, and Colorado, Louisiana, and New York contained two each.
- Overall metropolitan wage inequality levels are associated with wage outcomes by factors such as race and educational attainment. High levels of wage inequality in metro areas like Houston, Los Angeles, and New York accompany relatively large differences there in the earnings of whites versus other groups, and college graduates versus those with only a high school diploma.
- Unemployment rates skyrocketed between 2007 and 2009 in metropolitan areas most affected by the housing bubble and turmoil in the automotive industry. These effects are most obvious in metropolitan areas in California and Florida, where the effects of the housing crisis have been widespread, and in the manufacturing-oriented states of Ohio and Michigan. The geography of unemployment growth during this recession differed from that following the 2001 recession, primarily due to the extraordinary impact of the recent housing market collapse, though both downturns heavily impacted many Great Lakes metro areas.
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