The U.S. Supreme Court could be on the verge of issuing a major setback to racial integration efforts. In two weeks, it will hear oral arguments regarding whether the federal government and states should be permitted to pursue policies that perpetuate or exacerbate racial segregation in housing—even where no intent to segregate is proven.

The segregation of low-income minority families into economic and racial ghettos is one cause of the ongoing achievement gap in American education. Students from families with less literacy come to school less prepared to take advantage of good instruction. If they live in more distressed neighborhoods with more crime and violence, they come to school under stress that interferes with learning. When such students are concentrated in classrooms, even the best of teachers must spend more time on remediation and less on grade-level instruction.

The Economic Policy Institute, together with the Haas Institute for a Fair and Inclusive Society at the University of California, have organized a large group of housing scholars—historians and other social scientists—to sign a friend-of-the-court brief urging that housing policies perpetuating segregation should be banned.

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With today’s jobs report, we can now look at the state of the labor market in 2014 as a whole, and examine the trajectory of our economic recovery. The good news is that in 2014 people were increasingly finding jobs. The bad news is that we are still digging our way out of the recession, and wage growth remains stagnant and untouched by recovery.

In December, the economy added 252,000 jobs, while average monthly job growth in 2014 was 246,000 jobs. This is a clear improvement over the last several years. Since the end of the recession, we have seen an increasing number of jobs added each year, albeit a slow increase. In 2010, average monthly job growth was only 88,000. Average monthly job growth rose in each consecutive year, up to 194,000 in 2013 and 246,000 jobs a month in 2014.

If we continue to see the 2014 level of jobs growth for the next few years, we will return to pre-recession labor market health in August 2017. On the one hand, 246,000 jobs a month is a decent rate of growth; on the other hand, September 2017 is almost three years away, and nearly 10 years since the recession began.

Despite the minor surge in job creation over the last year, there is still substantial slack in the labor market, as evidenced by the continued sluggishness in nominal wage growth. Private sector nominal average hourly earnings grew 1.7 percent annually in December, lower than average, but in line with what we’ve seen this year so far. Nominal hourly earnings averaged $24.44 in 2014, up from $23.96 in 2013—the average annual growth rate between 2013 and 2014 was 2.0 percent.

As you can see in the figure below, for the last five years, nominal wages have grown far slower than any reasonable wage target. The fact is that the economy is not growing enough for workers to feel the effects in their paychecks and not enough for the Federal Reserve to slow the economy down out of fear of upcoming inflationary pressure. If the Fed acts too soon, it will slow labor share’s recovery and come at a cost to Americans’ living standards. It is imperative that the Fed keep their foot off the brake for as long as it takes to see modest (if not strong) wage growth for America’s workers.

Nominal Wage Tracker

Nominal wage growth has been far below target in the recovery: Year-over-year change in private-sector nominal average hourly earnings, 2007–2014

	All nonfarm employees	Production/nonsupervisory workers
Mar-2007	3.6427146%	4.1112455%
Apr-2007	3.3234127%	3.8461538%
May-2007	3.7257824%	4.1441441%
Jun-2007	3.8575668%	4.1267943%
Jul-2007	3.4482759%	4.0524434%
Aug-2007	3.5433071%	4.0404040%
Sep-2007	3.2337090%	4.1493776%
Oct-2007	3.2778865%	3.7780401%
Nov-2007	3.3203125%	3.8869258%
Dec-2007	3.1113272%	3.8123167%
Jan-2008	3.1067961%	3.8619075%
Feb-2008	3.0464217%	3.7296037%
Mar-2008	3.0332210%	3.7746806%
Apr-2008	2.8324532%	3.7037037%
May-2008	3.0172414%	3.6908881%
Jun-2008	2.6666667%	3.6186100%
Jul-2008	3.0000000%	3.7227950%
Aug-2008	3.2794677%	3.8263849%
Sep-2008	3.2747983%	3.6425726%
Oct-2008	3.3159640%	3.9249147%
Nov-2008	3.5916824%	3.8548753%
Dec-2008	3.6303630%	3.8418079%
Jan-2009	3.5310734%	3.7183099%
Feb-2009	3.4725481%	3.6516854%
Mar-2009	3.1775701%	3.5254617%
Apr-2009	3.2212885%	3.2924107%
May-2009	2.8358903%	3.0589544%
Jun-2009	2.7365492%	2.9379157%
Jul-2009	2.5889968%	2.7056875%
Aug-2009	2.4390244%	2.6402640%
Sep-2009	2.2977941%	2.7457441%
Oct-2009	2.3383769%	2.6272578%
Nov-2009	2.0529197%	2.6746725%
Dec-2009	1.8198362%	2.5027203%
Jan-2010	1.9554343%	2.6072787%
Feb-2010	1.8140590%	2.4932249%
Mar-2010	1.7663043%	2.2702703%
Apr-2010	1.7639077%	2.4311183%
May-2010	1.8987342%	2.5903940%
Jun-2010	1.7607223%	2.4771136%
Jul-2010	1.8476791%	2.4731183%
Aug-2010	1.7070979%	2.4115756%
Sep-2010	1.8867925%	2.2447889%
Oct-2010	1.8817204%	2.5066667%
Nov-2010	1.6540009%	2.1796917%
Dec-2010	1.7426273%	2.0169851%
Jan-2011	1.9625335%	2.2233986%
Feb-2011	1.8262806%	2.1152829%
Mar-2011	1.8246551%	2.1141649%
Apr-2011	1.9111111%	2.1097046%
May-2011	2.0408163%	2.1041557%
Jun-2011	2.1295475%	2.0493957%
Jul-2011	2.2566372%	2.2560336%
Aug-2011	1.9434629%	1.9884877%
Sep-2011	1.9400353%	1.9864088%
Oct-2011	2.1108179%	1.7169615%
Nov-2011	2.0228672%	1.8210198%
Dec-2011	1.9762846%	1.8210198%
Jan-2012	1.7060367%	1.3982393%
Feb-2012	1.9247594%	1.5018125%
Mar-2012	2.1416084%	1.7080745%
Apr-2012	2.0497165%	1.7561983%
May-2012	1.7826087%	1.4425554%
Jun-2012	1.9548219%	1.5447992%
Jul-2012	1.7741238%	1.3853258%
Aug-2012	1.8630849%	1.3340174%
Sep-2012	1.9896194%	1.3839057%
Oct-2012	1.4642550%	1.2787724%
Nov-2012	1.8965517%	1.4307614%
Dec-2012	2.1102498%	1.6351559%
Jan-2013	2.1505376%	1.8896834%
Feb-2013	2.1030043%	2.0408163%
Mar-2013	1.8827557%	1.8829517%
Apr-2013	1.9658120%	1.7258883%
May-2013	2.0504058%	1.8791265%
Jun-2013	2.1729868%	2.0283976%
Jul-2013	1.9132653%	1.9736842%
Aug-2013	2.2118248%	2.1265823%
Sep-2013	2.0356234%	2.1739130%
Oct-2013	2.2495756%	2.2727273%
Nov-2013	2.1573604%	2.2670025%
Dec-2013	1.9401097%	2.3127200%
Jan-2014	1.9789474%	2.2055138%
Feb-2014	2.1017234%	2.4500000%
Mar-2014	2.1419572%	2.2977023%
Apr-2014	1.9698240%	2.2954092%
May-2014	2.0510674%	2.3928215%
Jun-2014	1.9599666%	2.2862823%
Jul-2014	2.0442219%	2.2828784%
Aug-2014	2.1223471%	2.4789291%
Sep-2014	1.9950125%	2.2761009%
Oct-2014	1.9510170%	2.2222222%
Nov-2014	1.9461698%	2.1674877%
Dec-2014	1.6549441%	1.6216216%

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The data underlying the figure.

* Nominal wage growth consistent with the Federal Reserve Board's 2 percent inflation target, 1.5 percent productivity growth, and a stable labor share of income.

Source: EPI analysis of Bureau of Labor Statistics Current Employment Statistics public data series

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Turning to the household survey, where the official unemployment rate is determined, we see a similar story. The unemployment rate in December declined to 5.6 percent, primarily due to a drop in the labor force. All together, the unemployment rate for 2014 averaged 6.2 percent, down significantly from its high of an average of 9.6 percent in 2010. And, just in the last year, the unemployment rate has fallen dramatically, from an average of 7.4 percent in 2013. That said, the official unemployment rate fails to take into account millions of missing workers—workers who have been sidelined by the weak economy and who are expected to return to the labor market when job opportunities significantly improve.

Missing Workers

Millions of potential workers sidelined: Missing workers,* January 2006–December 2014

Date	Missing workers
2006-01-01	530,000
2006-02-01	110,000
2006-03-01	110,000
2006-04-01	250,000
2006-05-01	210,000
2006-06-01	110,000
2006-07-01	60,000
2006-08-01	-120,000
2006-09-01	120,000
2006-10-01	-50,000
2006-11-01	-220,000
2006-12-01	-500,000
2007-01-01	-460,000
2007-02-01	-210,000
2007-03-01	-150,000
2007-04-01	650,000
2007-05-01	560,000
2007-06-01	360,000
2007-07-01	370,000
2007-08-01	840,000
2007-09-01	410,000
2007-10-01	800,000
2007-11-01	280,000
2007-12-01	250,000
2008-01-01	-320,000
2008-02-01	220,000
2008-03-01	50,000
2008-04-01	340,000
2008-05-01	-60,000
2008-06-01	20,000
2008-07-01	-70,000
2008-08-01	-90,000
2008-09-01	180,000
2008-10-01	60,000
2008-11-01	420,000
2008-12-01	420,000
2009-01-01	710,000
2009-02-01	620,000
2009-03-01	1,050,000
2009-04-01	750,000
2009-05-01	650,000
2009-06-01	650,000
2009-07-01	1,040,000
2009-08-01	1,320,000
2009-09-01	2,050,000
2009-10-01	2,270,000
2009-11-01	2,300,000
2009-12-01	3,120,000
2010-01-01	2,770,000
2010-02-01	2,690,000
2010-03-01	2,440,000
2010-04-01	1,940,000
2010-05-01	2,530,000
2010-06-01	2,950,000
2010-07-01	3,220,000
2010-08-01	2,830,000
2010-09-01	3,200,000
2010-10-01	3,640,000
2010-11-01	3,310,000
2010-12-01	3,800,000
2011-01-01	3,910,000
2011-02-01	4,110,000
2011-03-01	3,960,000
2011-04-01	4,000,000
2011-05-01	4,110,000
2011-06-01	4,220,000
2011-07-01	4,640,000
2011-08-01	4,100,000
2011-09-01	3,990,000
2011-10-01	4,090,000
2011-11-01	4,090,000
2011-12-01	4,150,000
2012-01-01	4,450,000
2012-02-01	4,180,000
2012-03-01	4,240,000
2012-04-01	4,630,000
2012-05-01	4,240,000
2012-06-01	4,060,000
2012-07-01	4,520,000
2012-08-01	4,630,000
2012-09-01	4,500,000
2012-10-01	3,930,000
2012-11-01	4,370,000
2012-12-01	4,070,000
2013-01-01	4,350,000
2013-02-01	4,790,000
2013-03-01	5,310,000
2013-04-01	5,060,000
2013-05-01	4,840,000
2013-06-01	4,700,000
2013-07-01	5,030,000
2013-08-01	5,150,000
2013-09-01	5,370,000
2013-10-01	6,120,000
2013-11-01	5,700,000
2013-12-01	5,950,000
2014-01-01	5,850,000
2014-02-01	5,650,000
2014-03-01	5,330,000
2014-04-01	6,210,000
2014-05-01	5,940,000
2014-06-01	5,950,000
2014-07-01	5,810,000
2014-08-01	5,890,000
2014-09-01	6,250,000
2014-10-01	5,720,000
2014-11-01	5,760,000
2014-12-01	6,100,000

 

ChartData Download data

The data below can be saved or copied directly into Excel.

The data underlying the figure.

* Potential workers who, due to weak job opportunities, are neither employed nor actively seeking work

Note: Volatility in the number of missing workers in 2006–2008, including cases of negative numbers of missing workers, is simply the result of month-to-month variability in the sample. The Great Recession–induced pool of missing workers began to form and grow starting in late 2008.

Source: EPI analysis of Mitra Toossi, “Labor Force Projections to 2016: More Workers in Their Golden Years,” Bureau of Labor Statistics Monthly Labor Review, November 2007; and Current Population Survey public data series

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As I and others have written over the past month and half or so, President Obama’s new Deferred Action for Parental Accountability initiative (DAPA) will shield from deportation and provide work authorization to unauthorized immigrants who have a son or daughter who is a U.S. citizen or legal permanent resident, if they are not an enforcement priority and have been residing in the country for at least five years. DAPA will give the potentially four million who qualify the full spectrum of workplace rights provided under U.S. law. This means immigrant workers will be able to hold accountable employers who commit wage theft or violate workplace safety laws, without fearing threats of deportation that employers may lob at them to keep them from complaining. It’s easy to see how raising the floor for unauthorized immigrant workers in this way will benefit all workers, raise wages, and increase tax revenue. But nevertheless, not everyone is happy about it.

I always suspected that the agricultural industry would not support deferred action or any DAPA-like program, but until now the industry had been relatively quiet about their position. My assumption was that—because unauthorized immigrants comprise such a large share of the workforce employed in agricultural occupations, and because ag employers directly benefit from having unauthorized immigrant employees who can’t complain about dangerous workplaces where pesticides are in the air and extreme, triple-digit temperatures are the norm—they would find objectionable anything that increased farmworkers’ bargaining power or that allowed them to move to better-paying jobs in other industries. Because unauthorized immigrants don’t have a lot of bargaining power and are mostly employed by bosses willing to violate the law, they can’t easily get a job anywhere else, which means they have to put up with the low wages that are on offer in ag.

So I was pleasantly surprised to see some truth seep out onto the airwaves, thanks to a three-minute interview conducted by Tucker Carlson the other day on Fox and Friends, which sheds some light on what the ag industry really thinks about DAPA.

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