Monday, October 19, 2009

The Rich Get Richer: Weekly Wage Edition

Wages rose across the board! Good news right? Not necessarily. Per the WSJ:

There were about 8.2 million fewer full-time wage and salary workers in the third quarter than two years ago; the data doesn't include part-time or self-employed workers. Low-wage workers are hit disproportionally during recessions, and their absence from the tally could cause median wages to rise even if the typical worker isn't getting a raise.
Even with the benefit of the "drop out effect" of low-wage workers dropping out of the data, the lower income workers saw their weekly wages rise to a much less extent than higher income workers (i.e. the rich got richer). Here's the change in weekly earnings for quartiles and the top / bottom deciles since the recession began in December 2007.

BUT, part-time workers saw a large jump in pay too you say? Unfortunately, that is mainly due to:
  • A large number of these part time workers "should" be / were full-time workers, thus this "jump" in pay were actually pay cuts as they got downsized to part-time
  • Young workers were the only age group to see their wages decline over the past two years as there was limited demand for their services (the unemployment rate among young people is an outlier even in this ugly economy), thus a greater percent of the part-time workers were non-young people, who typically earn less
Historical figures...

Top decile earners now make more than 5 times the amount that bottom decile earners make, up from 4.4 in March 2000 (as far as this data goes back).

Source: BLS

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