Press Release: Middle-Income Workers Lose in December

    The Bureau of Labor Statistics reported today that the economy added nearly 300,000 (292,000) nonfarm payrolls, beating market expectations. Of those jobs added, the private sector hired 275,000 workers. The unemployment rate continues to sit at 5%, so-called full employment.

    Last month we praised the jobs report. In November the economy added a majority (54%) of the jobs above our measured median wage line. Even better, a huge chunk (42%) of the new jobs went to the middle-income industries. We were cautiously optimistic that a new trend in the labor market was forming.

    Our caution was warranted.

    For months, we’ve talked about the U-shaped pattern in the labor market. That’s when jobs gained come mostly from the lowest and highest-paying industries, at the expense of the middle class. Now the “U” has begun to skew to the low-wage side.

    Analysis by Dent Research finds that nearly half (48%) of the jobs added in December fell in the lowest third of the wage range. The big winners in that wage bucket were administration and support services, and restaurants.

    Middle-income jobs saw just 21% of the job additions. Dent Research finds that we added a majority of the jobs above the median wage line. But just barely. We added 138,000 above and 137,000 below. We’ll call that even.

    Commenting on the December report, Dent Research President and Index creator Rodney Johnson said, “After last month’s report, the current employment figures are almost a complete reversal. The bad news is back.”

    Each month Dent Research produces a detailed chart depicting where the job additions fall along the wage scale. You can see the full results below:

    See larger image (

    To give you a clearer look at this U-shaped recovery in jobs, we simplified our graph below. Instead of the usual 12 wage buckets, we collapse them into thirds. This gives a clearer picture of how the middle class continues to lag behind:

    See larger image (

    The Dent Research Employment Index digs beneath the BLS’ headline numbers to measure the quality of jobs added each month. It provides a more complete picture of the job market by tracking where jobs are being created along the wage scale. For a more detailed explanation of our methodology, please click here ( to view our employment white paper.


    About Dent Research

    Dent Research is an economic forecasting and investment research firm and publisher that works diligently to provide you with the proprietary economic knowledge you need to accurately forecast what lies ahead in our economy so you can take the necessary and appropriate action to ensure prosperity in your business, investment and financial affairs.

    The core of our work is what we call the Dent Method, which our founder and economic expert, Harry S. Dent Jr., developed in the late 1980s. It has the only documented record of success at forecasting long-term economic trends based on the study of and changes in demographic trends and their impact on our economy and the markets. It works by showing how predictable consumer-spending patterns, when combined with demographic trends, allow us to forecast the economy years or even decades in advance.

    For more than two decades, readers and experts have trusted our independent economic think tank and research team to provide specialized and proprietary economic and investment research, analysis tools, and forecast information.

    With Dent Research, investors and businessmen alike can learn how to recognize and potentially profit from economic and demographic cycles. They can also use our research to pinpoint the best growth industries, the best places to live, the hottest investment sectors, and the key technologies that will change everyday lives.

    For information about your membership, contact Member Services at:

    Delray Publishing
    Phone: 888-211-2215
    Fax: 410-223-2682
    Web: (
    Address: 55 NE 5th Avenue, Suite 200
    Delray Beach, FL 33483

    Protected by copyright laws of the United States and international treaties. This Newsletter may only be used pursuant to the subscription agreement and any reproduction, copying, or redistribution (electronic or otherwise, including on the worldwide web), in whole or in part, is strictly prohibited without the express written permission of Delray Publishing.

    This work is based on SEC filings, current events, interviews, corporate press releases and what we’ve learned as financial journalists. It may contain errors and you shouldn’t make any investment decision based solely on what you read here. It’s your money and your responsibility. The information herein is not intended to be personal legal or investment advice and may not be appropriate or applicable for all readers. If personal advice is needed, the services of a qualified legal, investment or tax professional should be sought. We expressly forbid our writers from having a financial interest in any security recommended to our readers. All of our employees and agents must wait 24 hours after on-line publication or 72 hours after the mailing of printed-only publication prior to following an initial recommendation.