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Vocapedia > Economy > Jobs > Pay / wage, Income gap / inequality

 

 

 

 

Dan Price, chief of Gravity Payments,

raised the annual salary floor for his employees to $70,000.

 

Most responses were positive,

but Mr. Price says that even the negative letters

were valuable.

 

Video.

 

Produced by: Jessey Dearing and Erica Berenstein

Watch more videos at: http://nytimes.com/video

 

YouTube

https://www.youtube.com/watch?v=GeAVMQWy41c

 

 

 

 

 

 

 

 

 

 

 

 

 

Wage Justice Is on the Menu        NYT        1 August 2015

 

 

 

Wage Justice Is on the Menu        Video        The New York Times        1 August 2015

 

Mark Bittman

talks with a leader of the food labor movement, Saru Jayaraman,

about how far the movement has come, and where it still has to go.

 

Produced by: University of California

Read the story here: http://nyti.ms/1fLwSID

Watch more videos at: http://nytimes.com/video

 

YouTube

https://www.youtube.com/watch?v=jqqcZ_zVPcM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Adriana Alvarez

earns $10.50 an hour as a cashier

at a Chicago-area McDonald’s.

 

She depends on Medicaid,

a child-care subsidy and food stamps

to help care for her 3-year-old son Manny.

 

Photograph:

David Kasnic for The New York Times

 

Working, but Needing Public Assistance Anyway

NYT

APRIL 12, 2015

http://www.nytimes.com/2015/04/13/
business/economy/working-but-needing-public-assistance-anyway.html

 

 

 

 

 

 

 

 

 

 

 

 

 

 

wage        UK

 

https://www.theguardian.com/business/2017/mar/22/uk-
ceos-national-living-wage-equality-trust-pay-gap

 

 

 

 

 

 

 

loving wage        USA

 

https://www.nytimes.com/2019/05/10/
opinion/uber-ipo.html

 

 

 

 

 

 

 

poverty wages        UK

 

https://www.theguardian.com/business/2018/sep/20/
wetherspoons-and-mcdonalds-staff-to-strike-together

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

wage        USA

 

https://www.npr.org/2018/08/02/
634754091/solving-the-wage-puzzle-why-aren-t-paychecks-growing

 

https://www.nytimes.com/2018/05/04/
business/economy/unemployment-jobs.html

 

https://www.npr.org/sections/thetwo-way/2018/02/02/
582641530/u-s-economy-added-200-000-jobs-in-january

 

 

 

 

http://www.npr.org/2017/08/04/
541321716/fact-check-have-low-skilled-immigrants-taken-american-jobs

 

http://www.npr.org/2017/08/03/
541220868/why-america-s-wages-are-barely-rising

 

 

 

 

http://www.npr.org/2016/05/05/
476844374/what-wage-stagnation-looks-like-for-many-americans

 

http://www.npr.org/sections/thetwo-way/2016/04/01/
472680235/minimum-and-overall-wages-are-rising-luring-workers-back

 

 

 

 

http://www.nytimes.com/2015/02/26/
business/next-goal-for-walmart-workers-more-hours.html

 

 

 

 

http://www.nytimes.com/2009/09/16/
business/economy/16leonhardt.html

 

 

 

 

 

 

 

low-wage workers        USA

http://www.npr.org/2015/04/03/
397316872/while-pay-holds-steady-for-most-low-wage-workers-get-a-boost

http://www.nytimes.com/2015/02/21/
opinion/walmart-gives-a-raise.html

 

 

 

 

low-paid workers        USA

https://www.npr.org/2020/02/26/
808113169/gives-me-hope-how-low-paid-workers-rose-up-against-stagnant-wages

 

 

 

 

low pay > factories        USA

http://www.npr.org/2014/12/23/
372722414/a-backlash-brews-against-low-pay-on-the-factory-floor

 

 

 

 

demand higher pay

and better working conditions        USA

https://www.npr.org/2019/10/23/
772760183/it-s-time-to-get-something-back-union-workers-voices-are-getting-louder

 

 

 

 

 

 

 

 

 

 

 

 

 

 

minimum wage        UK

 

http://www.theguardian.com/business/2007/mar/07/
money.politics

 

http://www.theguardian.com/society/2006/sep/29/
socialexclusion.business

 

http://www.theguardian.com/money/2005/nov/20/
politics.pay 

http://www.theguardian.com/money/2005/sep/30/
pay.socialexclusion

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

minimum wage        USA

 

https://www.nytimes.com/topic/subject/minimum-wage

 

 

https://www.npr.org/2020/02/26/
808113169/gives-me-hope-how-low-paid-workers-rose-up-against-stagnant-wages

 

https://www.npr.org/2020/01/09/
794280616/minimum-wage-hikes-fuel-higher-pay-growth-for-those-at-the-bottom

 

https://www.npr.org/sections/health-shots/2020/01/08/
794568118/raising-the-minimum-wage-by-1-may-prevent-thousands-of-suicides-study-shows

 

 

 

 

https://www.npr.org/2019/01/29/
689611873/in-maid-a-single-mother-finds-no-way-to-make-it-on-minimum-wage

 

 

 

 

https://www.npr.org/2018/12/30/
681055793/minimum-wages-rising-in-20-states-and-several-cities

 

https://www.npr.org/2018/07/27/
632723920/in-battle-pitting-cities-vs-states-over-minimum-wage-birmingham-scores-a-win

 

 

 

 

https://www.nytimes.com/2017/06/26/
business/economy/seattle-minimum-wage.html

 

 

 

 

http://www.npr.org/sections/thetwo-way/2016/11/29/
503719171/uber-drivers-other-workers-protest-for-15-minimum-wage

 

http://www.nytimes.com/2016/04/03/
sunday-review/how-the-15-minimum-wage-went-from-laughable-to-viable.html

 

http://www.nytimes.com/2016/02/19/
opinion/when-states-fight-to-overturn-good-local-labor-laws.html

 

http://www.nytimes.com/2016/02/17/
opinion/hillary-clinton-should-just-say-yes-to-a-15-minimum-wage.html

 

 

 

 

http://www.npr.org/sections/thesalt/2015/07/23/
425460095/fast-food-workers-cheer-as-15-minimum-wage-advances-in-new-york-state

 

http://www.nytimes.com/2015/05/21/
opinion/a-15-minimum-wage-bombshell-in-los-angeles.html

 

http://www.nytimes.com/2015/04/16/
opinion/a-new-day-for-the-minimum-wage.html

 

http://www.nytimes.com/2015/04/14/
business/owner-of-gravity-payments-a-credit-card-processor-
is-setting-a-new-minimum-wage-70000-a-year.html

 

http://www.nytimes.com/2015/04/13/
business/economy/working-but-needing-public-assistance-anyway.html

 

 

 

 

http://www.nytimes.com/2014/07/28/
business/a-big-union-intensifies-fast-food-wage-fight.html

http://www.nytimes.com/2014/04/25/
opinion/egan-how-to-kill-the-minimum-wage-movement.html

http://www.nytimes.com/2014/03/14/
opinion/economists-hit-back-in-the-minimum-wage-wars.html

http://www.nytimes.com/2014/02/28/
opinion/business-and-the-minimum-wage.html

http://www.nytimes.com/2014/02/19/
business/mixed-results-in-us-study-of-increasing-minimum-wage.html

http://www.nytimes.com/2014/02/10/us/
politics/fight-over-minimum-wage-illustrates-web-of-industry-ties.html

http://www.nytimes.com/2014/02/09/
opinion/sunday/the-case-for-a-higher-minimum-wage.html

http://www.npr.org/blogs/money/2014/01/16/
263129670/the-birth-of-the-minimum-wage-in-america

 

http://www.nytimes.com/2013/02/13/us/
politics/obama-pushes-for-increase-in-federal-minimum-wage.html

http://www.nytimes.com/2013/11/08/
business/10-minimum-wage-proposal-has-obamas-backing.html

http://www.nytimes.com/2013/01/05/
opinion/meanwhile-at-the-bottom-of-the-wage-scale.html

 

http://www.usatoday.com/news/washington/2007-01-24-
minimum-wage_x.htm

 

http://www.usatoday.com/news/washington/2006-12-21-
bush-minimum-wage_x.htm

http://www.usatoday.com/news/washington/2006-05-09-
minimum-wage_x.htm

 

 

 

 

 

 

 

minimum wage earners        UK

 

http://www.theguardian.com/society/2013/oct/26/
national-minimum-wage-earners

 

 

 

 

 

 

 

minimum wage > pro-labor laws passed by cities and counties        USA

 

http://www.nytimes.com/2016/02/19/
opinion/when-states-fight-to-overturn-good-local-labor-laws.html

 

 

 

 

 

 

 

live on the minimum wage        USA

 

http://www.nytimes.com/2014/02/09/
opinion/sunday/the-case-for-a-higher-minimum-wage.html

 

 

 

 

 

 

 

 

 

 

 

 

 

 

maximum wage        UK

https://www.theguardian.com/commentisfree/picture/2017/jan/10/
steve-bell-on-jeremy-corbyns-maximum-wage-proposal-cartoon

 

 

 

 

 

 

 

 

 

 

 

 

 

 

wage stagnation        USA

http://www.npr.org/2016/05/05/
476844374/what-wage-stagnation-looks-like-for-many-americans

 

 

 

 

paid family leave        USA

http://www.npr.org/2016/04/10/
473633537/paid-family-leave-advocates-celebrate-a-big-week-but-the-battles-not-over

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

The Guardian        Work        p. 2        8 October 2005

 

 

 

 

 

 

 

 

 

 

 

 

 

 

wage deal

 

 

 

 

wage abuses        USA

http://www.nytimes.com/2015/05/20/nyregion/
when-it-comes-to-wage-abuses-its-not-just-the-nail-salons.html

 

 

 

 

“wage theft”        USA

 

the violation of federal labor laws,

including failure to pay the minimum wage

and time-and-a-half for overtime,

denial of meal periods and rest breaks,

and mandatory unpaid work.

http://www.nytimes.com/2014/03/14/
opinion/happy-meals-unhappy-workers.html

 

http://www.nytimes.com/2014/09/01/
business/more-workers-are-claiming-wage-theft.html

http://www.nytimes.com/2014/03/14/
opinion/happy-meals-unhappy-workers.html

 

 

 

 

wage scale        USA

http://www.nytimes.com/2013/01/05/
opinion/meanwhile-at-the-bottom-of-the-wage-scale.html

 

 

 

 

falling wages        UK

http://www.guardian.co.uk/commentisfree/2011/mar/30/
peoples-panel-impact-recession

 

 

 

 

low-wage workers / lower-wage occupations / low-wage employer        USA        2012-2014

http://www.nytimes.com/2014/03/17/
business/economy/low-wage-workers-finding-its-easier-to-fall-into-poverty-
and-harder-to-get-out.html

http://www.nytimes.com/2014/02/20/
opinion/the-clear-benefits-of-a-higher-wage.html

 

http://www.nytimes.com/2013/08/13/
opinion/the-government-as-a-low-wage-employer.html

http://www.nytimes.com/2013/08/08/
opinion/fast-food-fight.html

 

http://www.nytimes.com/2012/12/08/nyregion/
jon-kest-community-advocate-in-new-york-dies-at-57.html

 

 

 

 

low-wage jobs        USA

http://www.nytimes.com/2011/04/01/
business/economy/01jobs.html

 

 

 

 

USA > blue-collar town        UK

http://www.theguardian.com/world/2014/aug/21/
ferguson-community-suffers-clashes-jobs-equality

 

 

 

 

white-collar

 

 

 

 

 white-collar criminals        USA

http://www.nytimes.com/2014/10/18/nyregion/
james-m-larossa-defender-of-mob-bosses-in-court-dies-at-82.html

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Living Paycheck to Paycheck        NYT        3 December 2014

 

 

 

 

Living Paycheck to Paycheck        Video        The New York Times        3 December 2014

 

The Vories family lives on a volatile income

— not knowing how much each paycheck will contain month-to-month.

 

In tough times,

Alex Vories borrows his father’s car

to deliver pizzas at night.

 

Produced by: A.J. Chavar

Read the story here: http://nyti.ms/1vLUr9c

Watch more videos at: http://nytimes.com/video

 

YouTube

https://www.youtube.com/watch?v=45Ouqrnku2g

 

 

 

 

 

 

 

 

 

 

 

 

 

 

earn

 

 

 

 

out-earn

http://www.npr.org/sections/thetwo-way/2016/12/09/
504989751/u-s-kids-far-less-likely-to-out-earn-their-parents-as-inequality-grows

 

 

 

 

pay        UK

http://www.theguardian.com/money/2013/nov/22/
interns-all-work-no-pay-internships

 

http://www.theguardian.com/business/2004/jun/25/
executivesalaries.executivepay 

 

 

 

 

pay        USA

http://www.npr.org/2015/08/28/
435245281/comparing-the-top-boss-pay-to-yours

http://www.nytimes.com/2015/04/16/
business/economy/in-test-for-unions-and-politicians-
a-nationwide-protest-on-pay.html

 

 

 

 

fair pay

 

 

 

 

unfair pay        UK

http://www.theguardian.com/money/2004/jan/14/
genderissues.pay 

 

 

 

 

executive pay        UK

http://www.theguardian.com/business/executive-pay-bonuses

 

 

 

 

C.E.O. pay        USA

http://www.nytimes.com/2014/04/15/
opinion/ceo-pay-goes-up-up-and-away.html

 

 

 

 

lousy pay        USA

http://www.nytimes.com/2014/01/11/
opinion/no-jobs-no-benefits-and-lousy-pay.html

 

 

 

 

pay deal

 

 

 

 

payrolls

 

 

 

 

paycheck        USA

https://www.nytimes.com/2017/06/03/
technology/yahoo-marissa-mayer-compensation.html

 

 

 

 

low-paid

 

 

 

 

underpaid

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Illustration:

Gérard DuBois

 

Calculate Your Economic Risk

NYT

MARCH 18, 2016

http://www.nytimes.com/2016/03/20/opinion/sunday/calculate-your-economic-risk.html

 

 

 

 

 

 

 

 

 

 

 

 

 

 

pay gap        UK

https://www.theguardian.com/society/2018/mar/02/
sadiq-khan-vows-action-over-london-public-workers-ethnicity-pay-gap

 

 

 

 

UK > gender pay gap        USA

https://www.nytimes.com/2018/05/13/
business/gender-pay-britain.html

 

 

 

 

pay gap

between highest-paid

and average employee        UK

https://www.theguardian.com/business/2017/mar/22/uk-
ceos-national-living-wage-equality-trust-pay-gap

 

 

 

 

pay gap        USA

http://opinionator.blogs.nytimes.com/2014/03/29/
can-we-close-the-pay-gap/

 

 

 

 

USA > NYC > gaping divide between rents and incomes        USA

http://www.nytimes.com/2016/03/12/
opinion/saving-a-mixed-income-new-york.html

 

 

 

 

gender pay gap / wage gap between women and men        USA

http://www.npr.org/2016/02/06/
465587253/states-not-waiting-to-close-gender-wage-gap

 

http://www.nytimes.com/2014/09/08/
your-money/fighting-the-gender-pay-gap.html

http://www.nytimes.com/2014/04/10/
opinion/the-truth-about-the-pay-gap.html

 

 

 

 

 

 

 

 

 

 

 

 

 

 

raise / pay raise        USA

http://www.npr.org/sections/health-shots/2016/04/01/
472661691/on-the-rise-workers-desire-for-raises-over-health-benefits

 

http://www.nytimes.com/2014/03/03/
opinion/where-have-all-the-raises-gone.html

 

 

 

 

raise        USA

http://www.nytimes.com/2015/02/21/
opinion/walmart-gives-a-raise.html

 

 

 

 

rise        USA

http://www.npr.org/2017/08/03/
541220868/why-america-s-wages-are-barely-rising

 

http://www.npr.org/sections/thetwo-way/2016/04/01/
472680235/minimum-and-overall-wages-are-rising-luring-workers-back

 

 

 

 

lift        USA

http://www.nytimes.com/2015/02/21/
opinion/walmart-gives-a-raise.html

 

 

 

 

 

 

 

 

 

 

 

 

 

 

bonus, bonuses / payout / staff payout        UK / USA

http://dealbook.nytimes.com/2011/01/28/
blankfein-gets-13-2-million-for-2010/

 

http://www.nytimes.com/2008/11/28/
opinion/l28bonus.html

http://www.nytimes.com/2008/11/20/
opinion/20ariely.html

http://www.guardian.co.uk/business/2008/nov/01/
royal-bank-scotland-vincent-cable

http://www.guardian.co.uk/business/2008/oct/17/
executivesalaries-banking

 

http://www.theguardian.com/business/2006/jul/30/
observerbusiness.bp 

 

 

 

 

city bonuses        UK

http://www.guardian.co.uk/business/2011/apr/26/
city-bonuses-shrink-pay-rise

 

 

 

 

golden hello        UK

http://www.guardian.co.uk/business/2011/mar/30/
lloyds-antonio-horta-osorio-pay-deal-shares

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Ordeal of Disney's Board Could Herald Changes in Pay Perks

NYT

August 10, 2005

http://www.nytimes.com/2005/08/10/business/media/10governance.html

 

 

 

 

 

 

 

 

 

 

 

 

 

 

equal opportunity

 

 

 

 

glass ceiling        UK

http://www.theguardian.com/money/2006/oct/02/
discriminationatwork.executivesalaries 

 

 

 

 

gender gap on pay and promotion

 

 

 

 

income / salary / salaries        UK

http://www.theguardian.com/money/2014/mar/25/uk-
incomes-how-salary-compare

 

http://www.guardian.co.uk/politics/2013/jun/01/
top-earners-millionaires-inequality-city-finance

 

 

 

 

income ladder        USA

http://www.npr.org/blogs/money/2014/05/05/
308380342/most-americans-make-it-to-the-top-20-percent-at-least-for-a-while

 

 

 

 

social ladder        UK

https://www.theguardian.com/commentisfree/2017/jul/31/
how-much-equality-britain-accept-discrimination

 

 

 

 

guaranteed basic income        USA

http://www.npr.org/2016/09/24/
495186758/as-our-jobs-are-automated-some-say-well-need-a-guaranteed-basic-income

 

 

 

 

income inequality / disparity        USA

https://www.nytimes.com/2017/04/05/
opinion/the-american-dream-meets-a-central-american-nightmare.html

 

http://www.npr.org/sections/thetwo-way/2016/12/09/
504989751/u-s-kids-far-less-likely-to-out-earn-their-parents-as-inequality-grows

http://www.nytimes.com/2016/12/06/
business/economy/a-dilemma-for-humanity-stark-inequality-or-total-war.html

http://www.npr.org/sections/codeswitch/2016/09/23/
495013420/black-white-wage-gap-racial-disparity-discrimination

http://www.nytimes.com/2016/06/09/
opinion/campaign-stops/separated-at-birth.html

http://www.nytimes.com/2016/03/20/
opinion/sunday/calculate-your-economic-risk.html

 

http://www.nytimes.com/2015/12/16/
movies/review-the-emperors-new-clothes-
a-documentary-about-income-inequality.html

 

http://www.nytimes.com/2014/11/17/
opinion/inequality-unbelievably-gets-worse.html

http://www.nytimes.com/2014/03/09/
business/a-top-heavy-focus-on-income-inequality.html

http://www.nytimes.com/2014/02/20/
business/economy/study-finds-greater-income-inequality-
in-nations-thriving-cities.html

 

 

 

 

racial disparities In wages        USA

http://www.npr.org/sections/codeswitch/2016/09/23/
495013420/black-white-wage-gap-racial-disparity-discrimination

 

 

 

 

inequality        UK

https://www.theguardian.com/business/2016/jul/03/
brexit-makes-bankers-think-about-inequality-stocks-bonds

http://www.theguardian.com/commentisfree/2016/may/25/
housing-crisis-jobs-babies-inequality-growing-up-world-
changed-young-people-capitalism-failures-adulthood

http://www.theguardian.com/politics/2016/may/21/
jeremy-corbyn-labour-economy-re-industrialisation-digital-age

 

 

 

 

inequality        USA

http://www.nytimes.com/2016/05/20/
opinion/obamas-war-on-inequality.htm

 

 

 

 

income gap        USA

http://www.npr.org/sections/thetwo-way/2016/02/25/
468120288/a-look-at-the-wealth-and-income-gap-by-zip-code

 

http://www.nytimes.com/2015/06/14/us/
hillary-clinton-attacks-republican-economic-policies-in-roosevelt-island-speech.html

 

 

 

 

A Look At The Wealth And Income Gap, By ZIP Code        USA

Updated February 25, 2016    4:50 PM ET

http://www.npr.org/sections/thetwo-way/2016/02/25/
468120288/a-look-at-the-wealth-and-income-gap-by-zip-code

 

 

 

 

white economic privilege        USA

https://www.nytimes.com/2017/07/29/
opinion/sunday/black-income-white-privilege.html
 

 

 

 

 

CEOs > pay / supersize salaries        USA

https://www.nytimes.com/2017/06/03/
technology/yahoo-marissa-mayer-compensation.html

 

http://www.npr.org/blogs/thesalt/2014/04/22/
305859588/fast-food-ceos-earn-supersized-salaries-workers-earn-small-potatoes

 

 

 

 

basic salary        UK

http://www.guardian.co.uk/business/2011/apr/26/
city-bonuses-shrink-pay-rise

 

 

 

 

 

 

 

 

 

And at the Bottom

of the Wage Scale ...

 

January 4, 2013

The New York Times


Nearly a million low-wage workers in 10 states will get a modest raise this year. In Rhode Island, a new law has raised the state’s minimum wage by 35 cents an hour, to $7.75, which will work out to an average annual raise of $510 for 11,000 Rhode Islanders. In nine other states — Arizona, Colorado, Florida, Missouri, Montana, Ohio, Oregon, Vermont and Washington — laws that peg the minimum wage to inflation will result in increases of 10 cents to 15 cents an hour, for hourly wages ranging from $7.35 in Missouri to $9.19 in Washington.

By contrast, the federal minimum wage has been stuck at $7.25 an hour since 2009. In all, 19 states and the District of Columbia set their minimums above that level, providing a much needed lift for the lowest-paid workers.
But state efforts are no substitute for a higher federal minimum because the ability to earn a minimally acceptable income should not depend on where a worker lives.

Will Congress finally raise the federal minimum wage this year? It would be the least that lawmakers could do. In the fiscal cliff deal, lawmakers locked in big tax breaks for wealthy investors and for heirs of multimillion-dollar estates. At the same time, they allowed the payroll tax cut for low- and middle-income taxpayers to expire, without enacting new provisions to ease the blow. The lowest-paid workers will be hit the hardest. In the states that raised their minimum wage this year, much of the increase will be eaten up by the higher payroll tax. In the other states, paychecks will simply be smaller.

Efforts to raise the minimum invariably run into arguments that employers, especially small businesses, cannot afford to pay a higher wage. But the evidence shows that most low-wage employees work for large companies, which have largely recovered from the recession and have reinstituted generous pay packages for executives. As for low-wage workers at small businesses, many are waitresses and other “tipped” workers for whom the federal minimum wage is $2.13 an hour, where it has been since 1991. Clearly, there is ample room for an increase.

A related argument is that a higher minimum wage destroys jobs, especially employment for teenagers. But research shows that most low-wage workers are over the age of 20 and suggests that paying them a higher wage could actually create jobs by bolstering consumer spending.

A higher minimum wage is also an obvious way to counter the accelerating trend toward low-wage work and growing income inequality. For decades, various forces, including the decline in unionization and the global competition for jobs, have pushed down wages in the United States. But the situation has become worse in the last few years, as most of the middle-wage jobs lost during the recession have been replaced with lower-paid work.

Raising the minimum wage is always a fight. Congress has approved legislation to do so only three times in the last 30 years. President Obama promised to take on this fight back in 2008, when he called for a federal minimum wage of $9.50 an hour by 2011, indexed to inflation. It is past time to keep the promise.

And at the Bottom of the Wage Scale ...,
NYT,
4.1.2013,
http://www.nytimes.com/2013/01/05/
opinion/meanwhile-at-the-bottom-of-the-wage-scale.html

 

 

 

 

 

Economic Scene

Next Victim of Turmoil: Your Salary

 

October 15, 2008

The New York Times

By DAVID LEONHARDT

 

It is possible, for the first time in weeks, to imagine that the credit crisis may be about to ease. But one of the big lessons of the last year has been not to underestimate the severity of the economy’s problems. Those problems are not just about housing or Wall Street.

What, then, will the next stage of the downturn be about? It is likely to revolve around the worst slump in worker pay since — you knew this was coming — the Great Depression. This slump won’t be anywhere near as bad as the one during the Depression, but it also won’t be like anything the country has experienced in a long time.

Income for the median household — the one in the dead middle of the income distribution — will probably be lower in 2010 than it was, amazingly enough, a full decade earlier. That hasn’t happened since the 1930s. Already, median pay today is slightly lower than it was in 2000, and by 2010, could end up more than 5 percent lower than its old peak.

If you look back at poll results over the last few decades, you will see that nothing predicts the public mood quite like income growth.

When incomes are growing at a good clip, as they were in the mid-1980s and late ’90s, Americans are upbeat. When incomes stagnate, as they did in the early ’80s, early ’90s and in the last several years, people get worried about the state of the country. In the latest New York Times/CBS News poll, 89 percent of respondents said that the country had “pretty seriously gotten off on the wrong track,” a record high.

So it’s reasonable to expect that the great pay slump of the early 21st century is going to have a big effect on the next several years. Falling pay will weigh on living standards, consumer spending and economic growth and will help set the political atmosphere that awaits the next president.



The events of the last several weeks have removed any serious doubt that the economy is in a recession. In a recession, businesses cut back on their workers’ hours, hand out raises that don’t keep pace with inflation and often skip paying bonuses. These cuts in hours and pay are the main way that a downturn affects families, because only a small share of workers actually lose their jobs.

As the chart next to this column makes clear, every recent recession has brought an effective pay cut of somewhere between 3 and 7 percent for the typical family. The drop typically happens over a period of about three years, lasting longer than the recession officially does, as pay fails to keep up with inflation.

The recent turmoil — the freezing up of credit markets, the fall in stock markets, the acceleration of layoffs — has made it unlikely that the coming recession will be a particularly mild one.

“The biggest hit will be in 2009,” Nariman Behravesh, the chief economist of Global Insight, a research and forecasting firm, told me, “and it probably won’t be until 2011 until we see any kind of pay gains.”

What will make this recession different, no matter how deep or shallow it is, is that it’s following an expansion in which most families received little or no raise. The median household made $50,200 last year, slightly less than the $50,600 that the equivalent household earned in 2000, according to the Census Bureau. That’s the first time on record that income failed to set a new record in an economic expansion.

Why has it happened? There is no single cause.

Medical costs have risen rapidly, which means that health insurance premiums take up a bigger chunk of workers’ paychecks than they used to. Some of this money goes to good use; it pays for treatments that weren’t available even a few years ago. But some of it, the part that disappears into the inefficient American health care system, is clearly wasted.

And in the last couple of years, the value of the typical worker’s benefits package has stopped growing. Since 2005, benefits packages have become slightly smaller, notes Jared Bernstein of the Economic Policy Institute. So health benefits can’t come close to explaining the recent pay stagnation.

The bigger factors are probably some combination of the following: new technologies, global trade, slowing gains in educational attainment, the rise of single-parent families, the continued decline in unionization and the sharp increase in inequality, which has concentrated income gains at the top of the ladder. Your political views will probably determine the relative weights that you assign to those causes. Economic research hasn’t yet definitively answered the question.

Whatever the cause, though, the effects of the pay slump are going to be significant. Households have already begun to cut back their spending, and they will do so even more next year. Mr. Behravesh predicts that inflation-adjusted consumer spending in 2009 will be somewhere between flat and down 1 percent. If he’s right, it would be the first year that consumer spending didn’t grow since 1980, which just happens to be the last time that the country suffered through a deep recession.

The pay slump will also make it harder for people to pay off their loans. Last week, Bank of America reported that its losses on consumer credit had tripled over the last year.

In all, banks around the world have acknowledged $600 billion in losses as part of the financial crisis. The latest International Monetary Fund analysis suggests they still have another $800 billion in losses ahead of them — and a good chunk of them will occur in this country.

It’s always possible, of course, that some bit of good and unexpected economic news is just around the corner. The situation also seemed pretty dire in the mid-1990s, until the Internet boom came along and incomes then started rising at their fastest pace since the 1960s.

But you would have to be a pretty zealous optimist to forecast a repeat of that story. For two decades, consumer spending has been an enormous driver of economic growth, thanks in good measure to a long bull market, a housing bubble and a boom in consumer debt.

The bull market, the housing bubble and the debt boom have all ended — and now paychecks are shrinking, too.

At some point, the next big economic engine will indeed arrive. It always does. This time, however, it’s going to have some stiff head winds to overcome.

Next Victim of Turmoil: Your Salary,
NYT,
15.10.2008,
http://www.nytimes.com/2008/10/15/
business/economy/15leonhardt.html

 

 

 

 

 

 

 

 

 

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