“When the bottom drops out, the average is different,” Elise Gould, senior economist at the Economic Policy Institute, told CNN Business.
The change highlights that the nation is still a long way away from a recovered labor market, with low-income workers still bearing the brunt of the pandemic crisis.
The leisure and hospitality sectors, which registered the biggest job losses due to the pandemic and the social distancing protocols it brought on, already paid below average earnings.
Similar dynamics are affecting the length of the average workweek.
As lower-paying jobs get added back as part of the long-awaited full reopening of the economy, average hourly earnings, as well as hours worked per week, will probably go down again, Gould said.
Economists worry that the reopening of the economy and high demand for jobs in hospitality and leisure will make it harder for workers to negotiate for better pay.
“One reason minimum wage in [President Joe Biden’s proposed] stimulus package would have been great is because these people have no bargaining power,” Gould said.
It’s still up to Washington to support the millions of people who remain jobless and who might return to a lower paying job in the future. That will make it more difficult to compensate for the wages lost in the meantime.