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Low Wage Workers Having Power Is a Good Thing

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The entire conversation about labor shortages and the right-wing freakout about low wage workers actually having power in the economy to make decisions about their own lives belies the real goals of wage policy–disciplining workers and reaping profits. But as the latest jobs report showed, this situation is having absolutely no negative effect on the economy.

The news is likely to be seen as a good sign for the economy more than one year into the pandemic, after numerous wrinkles have emerged to complicate a labor recovery many hoped would be faster at this level of vaccinations. It was the largest number of jobs added in a month since last August, during the early months of the labor market’s recovery.

“It’s a pretty strong report,” said Kate Bahn, an economist at the Washington Center for Equitable Growth. “This overshot expectations. And the job growth was in the industries that had been so hard-hit. This is pointing to signs that we’re growing back exactly where we need to be growing back.”

Employment jumped in the leisure and hospitality sector, with 343,000 jobs added, more than half in restaurants and bars. Hotels and other accommodations added about 75,000 jobs, as did arts, entertainment and recreation entities.

In local and state government education, employment increased by 230,000.

Retail added 67,000 jobs, with strong growth in clothing and merchandise stores.

Average earnings, too, continued to increase, climbing 10 cents for all employees to $30.40 an hour, following larger increases in May and April. The Bureau of Labor Statistics said the rising wages reflect higher demand for labor at this stage of the recovery.

In the leisure and hospitality sector, an often low-wage industry that has been a focal point of the debate about a labor shortage, wages for nonsupervisory workers rose markedly for the quarter, according to Diane Swonk, chief economist at Grant Thornton — up 87 cents an hour since April, the largest quarterly increase in the history of the data. Since January, those wages are up about $1.55, she said.

I hope you are sitting down for this, but workers will choose to labor in the hospitality and leisure sector if they are actually paid well for the job. Significantly improve those wages and *poof* there goes the labor shortage. I wonder if there are some lessons we could learn from this? Nah, better just cut off unemployment benefits and attack any kind of worker organizing.

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