AGENCY/PHOTOGRAPHER

Recommendations

Info

Jobs and Wages The most important step toward rebuilding middle-class economic security is raising middle-class incomes—and the vast majority of middle-class income comes from wages. 1 Therefore, raising wages and creating more good-paying jobs are both key to rebuilding middle-class incomes, wealth, and security. The U.S. economy has made a great deal of progress on job creation since the end of the Great Recession. It is impossible to overstate how dire the economic and job situation was at the beginning of 2009, when the economy suffered a worse financial crisis than in 1929 2 and was losing 800,000 jobs per month. 3 It took extraordinary government efforts—including fiscal stimulus, industrial and financial system rescues, tax cuts, small-business support, and more—to prevent the economy from collapsing. The Federal Reserve’s actions and commitment to its full-employment mandate were also—and remain—critical to turning the economic ship around. The economy has added about 15 million jobs since the labor market bottomed out in February 2010. 4 The unemployment rate in July 2016 was a low 4.9 percent, and broader measures of unemployment have almost returned to prerecession levels. 5 The economy’s progress toward recovery has been remarkable, yet there remains substantial room to create jobs. Last year marked the first year of healthy real wage growth in the recovery as a result of stronger nominal wage growth and low inflation. 6 More troublingly, stagnant wages were a problem that long preceded the Great Recession. While real middle-class wages grew robustly in the 1960s and early 1970s—as they had since World War II—beginning in the mid-1970s, real wage growth stalled and, at certain points, disappeared. Strong, sustained real wage growth returned in the late 1990s but has been mostly absent since 2001. 7 Families originally coped with this wage stagnation by working more hours—primarily women joining the workforce—and later borrowing against their homes. Ultimately, rebuilding middleclass incomes and wealth will require a return to solid, broad-based wage growth. 26 Center for American Progress | Raising Wages and Rebuilding Wealth
One of the most striking aspects of wage stagnation before 2007 was that it occurred despite substantial output and productivity growth. Indeed, Figure 2.1 below demonstrates that even the earnings of full-time, college-educated workers grew at a slower rate than productivity. In other words, while the pie grew plenty fast until 2007, rising inequality had prevented middle-class workers from sharing in those productivity gains. FIGURE 2.1 Economic growth has not trickled down to most workers—regardless of education Cumulative growth of nonfarm productivity and median compensation by education level since 1963 150% 120% 90% Productivity Graduate school College graduate Some college education High school graduate High school dropout 60% 30% 0% -30% 1963 1973 1983 1993 2003 2013 Source: Authors' analysis of the March Current Population Survey from Miriam King and others, “Integrated Public Use Microdata Series, Current Population Survey: Version 3.0,” available at https://cps.ipums.org/cps/index.shtml (last accessed July 2016). Compensation is based on weekly earnings of full-time, full-year 25- to 54-year-old workers, as well as the ratio between wages and compensation in the nonfarm sector. Productivity is net productivity from authors' analysis of data from the Bureau of Economic Analysis, "GDP and the National Income and Product Account Historical Tables," available at http://www.bea.gov/national/index.htm (last accessed July 2016); U.S. Bureau of Labor Statistics, "Labor Productivity and Costs," available at http://www.bls.gov/lpc/ (last accessed July 2016). Compensation has been adjusted for inflation using Federal Reserve Economic Database, "Personal Consumption Expenditures Chain-Type Price Index," available at https://fred.stlouisfed.org/series/PCEPI (last accessed July 2016). Broad-based wage growth has become even more difficult to achieve since the Great Recession as a result of weak demand and weak productivity growth. In this chapter, we analyze the forces restraining middle-class wage and job growth in the United States and propose a suite of policies to help boost them. Jobs and Wages | www.americanprogress.org 27
Page 1: AGENCY/PHOTOGRAPHER Raising Wages a
Page 5 and 6: Contents 1 Introduction and summary
Page 7 and 8: CHAPTER 1 Introduction and summary
Page 9 and 10: Nevertheless, public policy can and
Page 11 and 12: of growth came to an end. Middle-cl
Page 13 and 14: The main reason middle-class income
Page 15 and 16: The above analysis of incomes focus
Page 17 and 18: TABLE 1.2 Wealth across demographic
Page 19 and 20: FIGURE 1.6 The cost of education, h
Page 21 and 22: Policy response and recommendations
Page 23 and 24: • Address the labor market effect
Page 25 and 26: Health care • Address cost shifti
Page 27 and 28: Endnotes 1 Authors’ analysis of M
Page 29 and 30: Introduction and summary | www.amer
Page 31: CHAPTER 2 Jobs and Wages By Michael
Page 35 and 36: In sum, these five factors leave ma
Page 37 and 38: ments to open production sites in l
Page 39 and 40: The deterioration of other regulato
Page 41 and 42: ate returned to its 2001 level. The
Page 43 and 44: This speaks to a larger challenge t
Page 45 and 46: Underinvestment produces chronic ro
Page 47 and 48: sidized jobs program that would hel
Page 49 and 50: Restore worker bargaining power We
Page 51 and 52: Rebuild labor standards and the bro
Page 53 and 54: Additional steps should also be tak
Page 55 and 56: Policymakers should work with stake
Page 57 and 58: At the same time, we can take actio
Page 59 and 60: Endnotes 1 Authors’ analysis of C
Page 61 and 62: 52 Charles Whalen and Felix Reichli
Page 63 and 64: 96 Julia Gordon, “Inequality, Opp
Page 65 and 66: prehensive immigration reform. Pass
Page 67 and 68: An Immigration Policy that Works fo
Page 69 and 70: CHAPTER 3 Early Childhood By Katie
Page 71 and 72: Due to these high costs, parents ar
Page 73 and 74: information available to parents. 2
Page 75 and 76: Policy recommendations Two new poli
Page 77 and 78: Endnotes 1 Annie E. Casey Foundatio
Page 79 and 80: Early Childhood | www.americanprogr
Page 81 and 82: CHAPTER 4 Higher Education By Ben M
Page 83 and 84:
FIGURE 4.1 Average tuition and requ
Page 85 and 86:
FIGURE 4.3 Net price of public four
Page 87 and 88:
Policy recommendations Increasing h
Page 89 and 90:
Endnotes 1 Bureau of Labor Statisti
Page 91 and 92:
for the same home. 9 Furthermore, t
Page 93 and 94:
LGBT People Face Significant Barrie
Page 95 and 96:
CHAPTER 5 Health Care By Maura Cals
Page 97 and 98:
Health care benefits are part of a
Page 99 and 100:
When combined, these trends meant t
Page 101 and 102:
Policy recommendations The ACA made
Page 103 and 104:
The notice should outline how much
Page 105 and 106:
Require drug companies to justify p
Page 107 and 108:
Endnotes 1 Mark W. Stanton, “Empl
Page 109 and 110:
Health Care | www.americanprogress.
Page 111 and 112:
Workers with disabilities are also
Page 113 and 114:
with disabilities, child care provi
Page 115 and 116:
23 Faye Ong, ed., Inclusion Works!
Page 117 and 118:
CHAPTER 6 Housing By Sarah Edelman
Page 119 and 120:
FIGURE 6.1 Homeownership rate 75% 7
Page 121 and 122:
middle-class households: The share
Page 123 and 124:
Homebuyers in the coming decade may
Page 125 and 126:
Support and expand low down payment
Page 127 and 128:
Changes such as these have faced pu
Page 129 and 130:
for lots and rules against construc
Page 131 and 132:
20 Ibid. 21 Joint Center for Housin
Page 133 and 134:
63 CAP published a report in Decemb
Page 135 and 136:
African American and Latino workers
Page 137 and 138:
Endnotes 1 Due to a lack of disaggr
Page 139 and 140:
CHAPTER 7 Retirement By David Madla
Page 141 and 142:
FIGURE 7.1 Households are not build
Page 143 and 144:
FIGURE 7.3 Middle class households
Page 145 and 146:
The federal government plays a larg
Page 147 and 148:
Modernize survivorship and divorce
Page 149 and 150:
Fully implement the conflict of int
Page 151 and 152:
27 Christian E. Weller and David Ma
Page 153 and 154:
Retirement | www.americanprogress.o
Page 155 and 156:
CHAPTER 8 Conclusion By Brendan Duk
Page 157 and 158:
The country will elect a new presid
Page 159 and 160:
Conclusion | www.americanprogress.o
Page 161 and 162:
Thomas Huelskoetter is the Research
Page 163 and 164:
Acknowledgements The authors would
show all

AGENCY/PHOTOGRAPHER

You also want an ePaper? Increase the reach of your titles

Delete template?

Save as template?