Don't Drink the Tea. Think With the WE.
Sep
2011
15

“Despite the increased productivity, the male workforce has seen wages stagnate for the past three decades.”



New data released yesterday by the US Census Bureau shows that median household income fell by 2.3% in 2010, to $49,445 which is at the lowest level since 1996. More Americans fell into poverty, with the highest number in poverty on record. As a result, the share of income going to the middle-class has gradually eroded. Half of all money income in America went to the top 20 percent (average household income of $169,633), as income inequality continued to rise.

Today’s data confirm that the middle-class is still in a recession, and has been gradually shrinking over the last 40 years. The share of consumption by the domestic middle-class is also impacted by eroding incomes. More than ever, middle-class in America is struggling to make ends meet, with rising costs of housing, healthcare and education.

Falling wages are directly related to stagnant wages, that have been exacerbated by the current recession, with high unemployment. However, the problem of wages not keeping up with the growth in the economy is structural, as the workforce has not seen a commensurate increase in earnings, even when the economy has recovered from past recessions.

Despite the increased productivity, the male workforce has seen wages stagnate for the past three decades. Although the change in earnings was not significant in recent years, the median earnings of a male worker who works full-time, year-round ($47,715) are about the same they were in the 1970s. The number of men working full-time year-round decreased by 6.6 million during the recession since 2007.

Median earnings for male workers, when adjusted for inflation, has fallen consistently every year since 2006. This may reflect the fact that hours are cut, and more males lost jobs during this recession. Amongst both male and female workers, those with the highest fall in earnings were self-employed, where are private industry workers are seeing their earnings recover.

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