On Labor Day, Report Shows Workers Left Behind
August 29, 2008
 The wealthiest 10 percent of Americans got significantly richer in the last eight years, while income for the average working family is now less than it was in 2000, a new report by the Economic Policy Institute says.
The EPI’s “The State of Working America 2008/2009” illustrates the widening gap between affluent and increasingly poorer working Americans. Published every two years, the new edition examines trends in job growth, worker productivity and wealth distribution.
“The economic pie is certainly growing, but workers are getting smaller slices every year,” said Lawrence Mishel, an EPI economist and co-author of the report.
Since January, more than 400,000 jobs were lost, boosting the unemployment rate to more than 5 percent. Economists expect this figure to rise through the end of 2008. As unemployment rises, wages stagnate and hours get cut back – which means less employee leverage to bargain for better pay, the report says.
“Now that jobs are falling again, the U.S. job market is sailing into a new storm in a boat that’s already leaking,” co-author Heidi Shierholz said.
Slashes in benefits and wages have shifted the wealth to those at the top tier of the earning scale. In 2006, earners in the upper 10 percent of the income scale made 77 times as much as the bottom 90 percent, an inequality that has ballooned since 2000.
Other factors such as rising gas prices (up 25 percent since mid-2007) and declining housing values have created a perfect storm to keep working families’ savings low and corporate profits high. But the report’s authors also claim that the growth in productivity says good things about the average American worker.
“Putting aside the current cyclical downturn, the men and women who routinely keep this country running have been working harder and smarter,” the report says.
To read excerpts and select chapters of the report, visit www.epi.org.
Photo used under a Creative Commons license from Flickr user Montauk Beach.
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