![]() ![]() Yet sluggish wage growth is not a political secret it has been widely recognized across the political spectrum, even cited by both the Republican and Democratic Party platforms in 2016. In other words, the disappointing wage growth of recent decades is an important economic and political issue. In the fight for a piece of the ever-shrinking share of economic growth available to the bottom 90%, any one group’s gain can feel like another’s loss, leading to political divisions and hindering the formation of cross-racial coalitions based on common interests as workers. Further, while women’s wages have grown faster than those for men in recent decades, women’s wage growth still has lagged the economy’s potential. Because the historical legacy of racism has concentrated Black and Latinx workers in the lower half of the wage scale more so than white workers, widespread wage suppression based on class position has inflicted disproportionate harm on them. workers experienced wage growth slower than the economywide average, while workers at the top (mostly highly credentialed professionals and corporate managers) and owners of capital reaped large rewards made possible only by this anemic wage growth for the bottom 90%. The effects have been felt broadly: During this time 90% of U.S. Inequality will stop rising, and paychecks for typical workers will start rising robustly in line with productivity, only when we enforce labor standards and embrace policies that reestablish individual and collective bargaining power for workers.īetween 19, the compensation of median workers trailed economywide (net) productivity growth by roughly 43%, leading to rising inequality. This paper presents evidence that the divorce between the growth of median compensation and productivity, the inequality of compensation, and the erosion of labor’s share of income has been generated primarily through intentional policy decisions designed to suppress typical workers’ wage growth, the failure to improve and update existing policies, and the failure to thwart new corporate practices and structures aimed at wage suppression. This growing divergence has been driven by two other widening gaps, that between the compensation received by the vast majority of workers and those at the top, and that between labor’s share of income and capital’s. economy, and a central driver in recent decades is the widening gap between the hourly compensation of a typical (median) worker and productivity-the income generated per hour of work. ![]()
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