Happy (?) Labor Day

If economy is growing, why aren't workers' wages growing?

Ralph Martire, Chicago Sun-Times:

Just in time for Labor Day, the federal government released some good news about the economy: It's growing, continuing a five-year trend. Incomes across all households are up, while corporate profits hit their highest point since the 1960s. And to whom do we owe this apparent good news? Why, the American worker. Continuous increases in worker productivity (along with inflated consumer spending financed by credit card debt and mortgage refinancings), has driven economic growth.

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The truth is, as corporate profits surged, wages for the vast majority of Americans stagnated or declined.

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What about the fact that average income is growing? That's true enough, but misleading. Average income increased overall solely because incomes at the very top exploded. For 80 percent of workers, incomes actually declined on an inflation-adjusted basis since November 2001.

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Maybe Labor Day celebrations would be more festive if instead of being paid tribute, workers were actually being paid.

Many Entry-Level Workers Feel Pinch of Rough Market

Steven Greenhouse, New York Times:

Entry-level wages for college and high school graduates fell by more than 4 percent from 2001 to 2005, after factoring in inflation, according to an analysis of Labor Department data by the Economic Policy Institute. In addition, the percentage of college graduates receiving health and pension benefits in their entry-level jobs has dropped sharply.

Study: Wages losing ground despite growth

Niala Boodhoo, McClatchy Newspapers

In the past 10 years, U.S. productivity, a measure of worker output, has increased 33 percent, something economists have hailed as a victory for America's "new economy," because productivity is often seen as the key to raising living standards.

In a speech last week, Federal Reserve Chairman Ben Bernanke called the gain one of the past decade's most significant economic developments.

But the problem, according to a new book-length study, is that workers are no longer seeing those increases where it matters most to them: in their paychecks.

Wages stopped rising and actually began losing ground starting in 2001, despite continued growth in productivity and corporate profits, according to an analysis of government data in "The State of Working America: 2006/2007" by the Economic Policy Institute, an independent Washington think tank.

Happy Labor Day? The great pay divide

Editorial, Philadelphia Inquirer:

Defenders of President Bush say the economy is percolating at a good rate, and by some measures, that's true. They just don't happen to be the measures that most affect the status of the average working stiff.

Besides sluggish wages, workers' share of health insurance and pension costs has gone up. Among college graduates in entry-level jobs, the segment with company health insurance dropped from 70 percent to 63 percent between 2000 and 2005.

New census figures also show the recovery since the 2001 recession had little impact on poverty. After four years of upticks, the poverty rate remained 12.6 percent in 2004 and 2005. That's 37 million Americans below the poverty line; many of them work every day.

Meanwhile, the average pay of corporate CEOs has grown to 262 times that of an average worker. In 1965, the ratio was 24 times.

The people in power in Washington right now don't like to talk about such disparities. That's engaging in class warfare, they say. No, it's pointing out trends that run contrary to the American ideal.

Pointing out realities is not class warfare. But you know what is? Pushing tax and economic policies that worsen trends toward inequality.

So, enjoy the holiday. But be aware that the statistics that surround it aren't worth much of a celebration.