Worker Pay Still Flat After Six Years
From the NYT:
By Neil Irwin
JUNE 17, 2014
… Consumer prices rose 0.4 percent in May, such that inflation over the last year is now 2.1 percent, about in line with what the Federal Reserve aims for.
But that inflation news carried with it a depressing side note. Now that the Consumer Price Index for May has been published, it is possible to determine inflation-adjusted hourly earnings for the month. And the number is not good.
Average hourly earnings for private sector American workers rose about 49 cents an hour over the last year, to $24.38 in May. But that wasn’t enough to cover inflation over the year, so in real or inflation-adjusted terms, hourly worker pay fell 0.1 percent over the last 12 months. Weekly pay shows the same story, also falling 0.1 percent in the year ended in May.
Pause for just a second to consider that. Five years after the economic recovery began, American workers have gone the last 12 months without any real increase in what they are paid.
Some of that is perhaps a few long term unemployed finally getting poorly paid jobs, thus nudging down the average pay. But still …
… But for right now, the evidence points to more of what we’ve seen for most of the last six years: Employees have little negotiating power to demand higher pay.
Thank goodness that Mark Zuckerberg and Eric Cantor have a plan to address the crisis of soaring salaries among American workers by increasing H-1B visas. And kudos to the Obama Administration for having the foresight to invite in so many Central American adolescents to bolster America’s thinly stretched strategic supply of child labor.