Recession hits Milwaukee as firms lay off workers

The US economy has shed 300,000 private sector jobs over the past three months.

Wisconsin lost 8,600 manufacturing positions last year and 9,600 private sector jobs in total.

And things appear to be getting worse.

Yesterday, Harley Davidson announced it will lay off 730 employees, including hundreds at its Milwaukee facilities where just a few year ago workers agreed to concessions in an effort to secure work.

Midwest Express is eliminating 109 positions, 3.5% of its workforce.

Briggs and Stratton might halt the production of small engines in May if the market for lawn and garden equipment continues to sag.

For those left working, workweeks and wages are being reduced.

4.9 million workers are now employed in part-time positions because they cannot find full time employment!

The New York Times reports today that:

The gradual erosion of the paycheck has become a stealth force driving the American economic downturn. Most of the attention has focused on the loss of jobs and the risk of layoffs. But the less-noticeable shrinking of hours and pay for millions of workers around the country appears to be a bigger contributor to the decline, which has already spread from housing and finance to other important areas of the economy.

While official unemployment has risen only modestly, to 5.1 percent, the reduction of wages and working hours for those still employed has become a primary cause of distress, pushing many more Americans into a downward spiral, economists say...

Last month, the hours worked by those on American payrolls dropped, compared with six months earlier, according to an index maintained by the Labor Department. The last time the index moved into negative territory was February 2001, when the economy was on the doorstep of recession. A similar slide emerged in August 1990, one month into what proved an even more severe downturn.

And on Wednesday, the government reported that average earnings slipped in March after accounting for the rising costs of food and fuel — the sixth consecutive month that pay failed to keep pace with inflation.

As people bring home paychecks that do not go as far, they are forced to economize, eliminating demand for goods and services that once captured their dollars, spreading pain to providers like auto dealers and lawn care providers. They, too, must trim their outlays on pay, shrinking working hours more and furthering the slowdown

Immediate federal action is required to help those who are losing jobs and income and to reinvigorate the economy.

A basic stimulus package would include extending unemployment benefits, which currently lapse after twenty-six weeks, and providing assistance to the twenty-five states that are facing budget deficits. The time to act is now!