Not only is the U.S. employment still down by more than two million jobs from its level before the 2001 recession, but the new jobs being generated generally pay lower wages than the ones that are disappearing, the Economic Policy Institute (EPI), a research organization in Washington D.C., said in a recent study. Employment is shrinking in higher paying sectors such as manufacturing and information services, and expanding in areas such as leisure and hospitality, which generally pay lower wages, the EPI said.

The study found that in those industries where employment is contracting, the average annual salary nationally is $44,570, while average pay in expanding industries is only $35,410, a difference of 21 percent. The shift from higher paying industries to lower paying ones has occurred in 48 of the 50 states according to EPI. Only Nebraska and Nevada have seen growth in higher wage industries it said.

“This dynamic has the potential to significantly slow the growth of living standards for working families,” the Institute said.

The study examined employment and wage patterns between November 2001, when the recession ended, and November 2003. The EPI analyzed data from two surveys conducted regularly by the Labor Department’s Bureau of Labor Statistics: the monthly nonfarm payroll survey of 400,000 business establishments and a quarterly survey of employment and wages based on employer information filed with state employment security agencies.

According to the EPI, the economy lost 726,000 jobs in the 24 months between the end of the recession in November 2001 and November 2003. The industry with the largest loss was manufacturing, which shed 1.3 million jobs during that period.