There is now clear statistical evidence that the real income
of the average American household has been stagnant fora decade.
At first, many economists dismissed the numbers as unreliable or
as a temporary aberration. But the trends have persisted, and
corroborating analyses by independent researchers now leave
little doubt that profound shifts in the distribution of income
and wealth are occurring beneath the surface of the U.S. economy.
These shifts suggest that the economy is failing to generate a
higher standard of living for the majority of Americans — which
is the ultimate measure of economic performance.
Statistics being what they are, there is no one single number
that completely reflects the stagnation in real (inflation
adjusted) incomes. The evidence is rather a mosaic of data,
which, when looked at as a whole, presents an unmistakable
pattern. This briefing paper displays the major pieces of the
mosaic of income stagnation and examines its primary causes.