If the economy is supposedly growing, why is job growth still a problem? Which leads me to the related question: if an economy isn’t producing jobs, what good is it?

The folks at the Economic Policy Institute put out a report last week that did not get widespread attention. Called “The Lukewarm 2004 Job Market.” it has some troubling evidence that shows that almost every group of workers saw their wages drop relative to inflation and the supposed “recovery” during 2004 produced 1.4 million fewer jobs than would be expected–which means people are unemployed for longer periods of time and are exhausting their unemployment benefits in record numbers.

The report concludes:

These problems of falling wages, inadequate job creation, long-term unemployment, and a safety net that’s failing to protect job losers have contributed to a recovery that is considerably unbalanced. The economic growth that has occurred has flowed to corporate profits to a degree unseen in the post-World War II period, leaving relatively little for compensation.

So, what going on here? The economy may be growing–meaning there is a lot of buying and selling of something–but the benefits of that apparent growth are flowing into corporate bank accounts, not people. Corporations are eliminating the need for new jobs–partly because of technology and partly because they can have so much down for cheaper labor costs in countries like China.

We may be in for this trend for a long time. Which brings me back to my original point: what good is an economy that does not create enough jobs for its people?