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Displaced Workers Getting Back to Work, But Not Necessarily for Same Wage

September 4, 2014 by Kathleen Algire-Fedarcyk in Blog, Budget and Tax, Economic Opportunity

More people who lost their jobs due to cut backs are returning to work and in greater numbers than in the past, according to a report released by the U.S. Department of Labor (DOL) and Bureau of Labor Statistics (BLS) on August 26. The report found that two out of three workers displaced between 2011 and 2013 were employed at the start of 2014, but less than half are earning what they used to. The number of the reemployed was up 5 percentage points from the last reporting period, January 2012. 

The Department of Labor defines a displaced worker as “a person 20 years of age or older who left or lost their job because their plant or company closed or moved, there was insufficient work for them to do, or their position or shift was abolished.” Displaced workers are categorized as long-tenured, those who held the job for 3 years or longer, and short-tenured, those who held the job for less than 3 years. 4.3 million workers were displaced from long-tenured jobs and 5.2 million were displaced from short-tenured jobs between 2011 and 2013, totaling 9.5 million.  

 Overall, workers’ wages have remained stagnant for the past two years, but when these people went back to work, many actually took a pay cut. Twenty-seven percent of newly reemployed people had their pay decrease by 20 percent or more.

 Displaced workers came from many sectors of the economy but the three industries with the largest shares were:

  • manufacturing (18 percent of all displaced workers)
  • wholesale and retail trade (14 percent)
  • professional and business services (14 percent)

Unfortunately, those were not the industries hiring back workers. Displaced workers from the transportation and utilities (69 percent), leisure and hospitality (69 percent), construction (68 percent), and information (67 percent) sectors were more likely to be back on the job. Displaced workers from wholesale and retail trade were least likely to be reemployed.

While we do not have specific figures for Maryland, the trends are likely similar. Maryland job growth mimicked national trends and in July 2014 added 1,400 jobs in natural resources, mining, and construction and 1,100 jobs in trade, transportation, warehousing, and utilities.   

 People reentering the workforce need better outcomes. The job market will always ebb and flow, but no matter the job they hold or industry they enter Maryland workers should be able to support themselves and their families. That is why we need paid sick leave and other policies that make it possible for hard-working people to make ends meet.

 For more information on the campaign for paid sick leave visit Moving Maryland Forward.