march 9, 2012 making work pay how raising wages is key to boosting living standards january 7, 2016...

March 9, 2012

Making Work Pay – How Raising Wages is Key to

Boosting Living Standards

January 7, 2016Atlanta, GA

David Cooper Economic Policy Institute

1

The benefits of increased productivity over the last 40 years have not gone to the middle

class

2

1948 1952 1956 1960 1964 1968 1972 1976 1980 1984 1988 1992 1996 2000 2004 2008 2012-50%

0%

50%

100%

150%

200%

250%

300%

Productivity

240.7%

Real median family income

137.1%

Productivity and real median family income growth, 1948–2013

Source: EP'sI analysis of Current Population Survey Annual Social and Economic Supplement Historical In-come Tables, (Table F-5) and Bureau of Labor Statistics, Productivity – Major Sector Productivity and Costs database

Growing together, then growing apart

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4

Where did all that productivity growth go?

5

Meager earnings growth for most Americans

Rising inequality, driven by stagnant wages, has stifled improvements in living standards for most of the last generation of Americans, and stymied our ability to make progress in reducing poverty.

6

The “inequality tax”

7

Progress against poverty stalled

8

Stagnant income comes from stagnant wages

9

For most, almost no growth in hourly pay

10

The picture for Georgia

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1979

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

2013

2014

-20.0%

-10.0%

0.0%

10.0%

20.0%

30.0%

40.0%

10th percentile -7.2%

50th percentile (Median)

7.7%

90th percentile

201424.1%

Change in real hourly wages in GA since 1979, by wage decile

Source: EPI analysis of Current Population Survey Outgoing Rotation Group microdata, 1979-2014

12Source: EPI Family Budget Calculator: http://www.epi.org/resources/budget/

Family Budget for Atlanta, GA

Policies that would raise wages

1. Raising the minimum wage & tipped minimum2. Strengthen and enforce labor standards– Wage theft, misclassification, overtime rules– Non-competes / mandatory arbitration

3. Paid sick leave / family leave4. Fair schedule laws / no just-in-time scheduling5. Strengthen/maintain unemployment insurance6. Protect the right to organize

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14

15

16

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Policies that would raise wages

1. Raising the minimum wage & tipped minimum2. Strengthen and enforce labor standards– Wage theft, misclassification, overtime rules– Non-competes / mandatory arbitration

3. Paid sick leave / family leave4. Fair schedule laws / no just-in-time scheduling5. Strengthen/maintain unemployment insurance6. Protect the right to organize

18

Policies that would raise wages

1. Raising the minimum wage & tipped minimum2. Strengthen and enforce labor standards– Wage theft, misclassification, overtime rules– Non-competes / mandatory arbitration

3. Paid sick leave / family leave4. Fair schedule laws / no just-in-time scheduling5. Strengthen/maintain unemployment insurance6. Protect the right to organize

19

20

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Education is important, but not a panacea

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2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

-0.1

-0.08

-0.06

-0.04

-0.02

0

0.02

0.04

0.06

-5.7%

-3.8%

-9.3%

-3.1%

Real hourly wages since 2000 by education level (2014$)

Less than high school High school Some college Bachelor's or higher

Source: EPI analysis of Current Population Survey Outgoing Rotation Group microdata, 1979-2014

For more information

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David Cooperdcooper@epi.org

Economic Policy Institute1333 H Street, NW

Suite 300, East TowerWashington, DC 20005-4707

202.775.8810

www.epi.org