Lawrence Mishel, Economic Policy Institute, Issue Brief #351 February 21, 2013

As is well-documented in The State of Working America, 12th Edition (Mishel et al. 2012), the U.S. economy has worked primarily to the advantage of a small sliver of winners.Meanwhile, the vast majority of workers have not fared well—a trend that stretches back to the 1970s.

Between 1973 and 2011, the median worker’s real hourly compensation (which includes wages and benefits) rose just 10.7 percent. Most of this growth occurred in the late 1990s wage boom, and once the boom subsided by 2002 and 2003, real wages and compensation stagnated for most workers—college graduates and high school graduates alike. This has made the last decade a “lost decade” for wage growth. The last decade has also been characterized by increased wage inequality between workers at the top and those at the middle and bottom, and by the continued divergence between overall productivity and the wages or compensation of the typical worker. This divergence has been demonstrated anew in the current recovery over 2009–2011 as real wages fell for the bottom ninety percent of the wage distribution but rose for the top five percent (Mishel and Finio 2013).

Download Declining Value of the Federal Minimum Wage is a Major Factor Driving Inequality