U.S. Wages Are Stagnant, While Cost of Living Has Skyrocketed -- And It's All Because of Greed
Number of the day:
4%: The real private-sector wage growth over the past decade, which falls "far short of any 10-year period since World War II, according to Commerce Department data. In fact, if the data are to be believed, economywide wage gains have even lagged those in the decade of the Great Depression (adjusted for deflation)."
Two years into the recovery, and 10 years after the nation fell into a post-dot-com bubble recession, this legacy of near-stagnant wages has helped ground the economy despite unprecedented fiscal and monetary stimulus — and even an impressive bull market.
Over the past decade, real private-sector wage growth has scraped bottom at 4%, just below the 5% increase from 1929 to 1939, government data show.
To put that in perspective, since the Great Depression, 10-year gains in real private wages had always exceeded 25% with one exception: the period ended in 1982-83, when the jobless rate spiked above 10% and wage gains briefly decelerated to 16%.
...The long dry spell for real wage gains tests the natural resilience of America's consumer economy.
To say the least.
There's a lot of blaming and shaming of USians for frivolous spending and living beyond their means and being recklessly avaristic consumers—and, you know, I'm sure there are people like that, but I sure don't know a hell of a lot of them. (Or any of them.) I know of a lot of people who getaccused
of being irresponsible when they lose their homes because of unemployment, or medical bills, or predatory lending, or some combination thereof.
And all of that finger-pointing masks the reality reflected in the above numbers: The average standard and cost of living in the US have changeddramatically
over the course of a single generation.
I now live in the same town in which I grew up, on the other end of the same street on which I grew up, in a smaller house than the one in which I grew up, and in which my parents still live at the other end of the street. My dad was a public high school teacher, and, until I was 18, my parents, sister, and I (and a menagerie of cats, dogs, turtles, and birds) lived on his salary—and, although I never had expensive clothes and my parents never had the best cars or the nicest electronics, we did all right, and my parents managed to save money for retirement to boot. Iain and I have no kids, share one car, have no savings, and two full-time salaries.
There is simply no way we could have the same life that I had growing up in the same place 30 years ago.
That's the reality of wage stagnation in the US.
And it's the result of greed, but not on the employee side of the paycheck.