Media clips
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Labor organizers have planned a major fast-food worker strike this Thursday that will take place in an estimated 150 cities around the country. The strike comes on the heels of a Labor Day speech in Milwaukee by President Barack Obama that called once again for a raise in the minimum wage. In an opinion piece for the National Journal, economist David Cooper writes, “Raising the federal minimum wage would significantly improve the lives of millions, help spur wage growth, and reduce the gender pay gap.” Cooper said that raising the minimum wage to $10.10 per hour would lift wages for 28 million working Americans — nearly 20 percent of the entire U.S. workforce. “When you raise the minimum wage, you’re not just lifting wages for folks that are right at the bottom. You’re also going to lift wages for those making just above the minimum wage. This is what we call the spillover effect,” he said.
Wisconsin Public Radio September 5, 2014 -
This is just quite delightful:
“Labor’s share of income measures the percentage of corporate profits that go to pay wages to employees – as opposed to enriching shareholders and other owners.”
In 2013, labor’s share of income fell to 72.7%, according to the Economic Policy Institute. In the first half of 2014, however, the number spiked up.
No, simply no. Labour’s share of income just isn’t the amount of corporate profit that flows to labour. That’s a gross misunderstanding of what is actually happening here. Labour is of course a cost to a corporation and in order to calculate profits we look at income, subtract all of the costs (so, subtract cost of goods sold, the cost of labour, the cost of rent and utilities and so on) and what’s left over is the profit. So, the labour share is that portion of corporate income that goes to wages. And no, the residual, after labour income, is not what flows to owners and shareholders either. Labour income plus corporate profits does not amount to 100% of the economy, nor even to 100% of the income of the corporate sector.
What makes this so lovely is that the source that Ms. Moore is using is very clear on this point. Here’s the EPI:
“The figure below shows a particularly stark measure: the share of corporate sector income accounted for by workers’ wages and benefits.”
Forbes September 5, 2014 -
The median value of all financial assets was also down, decreasing 8% to $21,000. Although markets soared from 2010 to 2013, only about a third of households have stock holdings of at least $10,000, according to the Economic Policy Institute.
The median value of stock holdings rose 26% to $27,000.
The share of Americans owning certificates of deposit fell sharply as bank interest rates remained meager, to 7.8% from 12.2%
The portion with retirement accounts fell below 50%, though their median value increased 25% to $59,000. “The growth is likely explained by resurgent stock markets and increased contributions by those who participated in retirement plans,” the report said.
The early years of the recovery also featured a welcome decline in household debt, with the share of families holding any type of debt falling to 74.5% from 74.9%. Only 42.9% had mortgages, down from 47% in 2010.
Twenty percent of households, however, had student loans, up from 19.2%, and their median value rose 15% to $16,000.
USA Today September 5, 2014 -
Yet Josh Bivens, research director at the liberal Economic Policy Institute, says America’s relatively low “headline unemployment rate is painting too rosy a picture of how the U.S. labor market is doing.”
Associated Press September 5, 2014 -
American workers’ wages fell in the first half of 2014 compared to the first half of 2013 with few exceptions, according to a report released this week by the Economic Policy Institute.
The falling wage trend goes back even further. When compared to the first half of 2007, for instance, wages in the first half of this year were flat or falling. In fact, the depressed wages pattern holds fast even when you compare 2014 wages to those in 1979 (after accounting for inflation).
Productivity from 1979 to 2013 grew 64.9% while hourly compensation of production and nonsupervisory workers, who account for 80% of the private sector workforce, grew by just 8%.
Fortune September 5, 2014 -
Economist Elise Gould at the Economic Policy Institute says that shows there’s still significant slack in the labor market. Employers don’t have to offer higher pay to attract and retain workers, and workers don’t have much bargaining power.
“Workers are really not seeing the growing productivity, the growing economy, in higher wages,” Gould said.
Marketplace September 5, 2014 -
For instance, new research from the Economic Policy Institute shows that from the first half of 2013 to the first half of 2014, hourly wages, adjusted for inflation, fell for nearly everyone. An exception was a small gain for the bottom 10 percent of wage earners, which was because of minimum-wage increases in 13 states this year.
That’s clear evidence that raising the federal minimum wage, while only a first step toward better pay, would have a powerful effect. A lift from the current $7.25 an hour to the modest $10.10 called for by President Obama and Democrats in Congress would put an estimated additional $35 billion in the pockets of affected workers over a three-year phase-in period.
The New York Times September 5, 2014 -
Veronique de Rugy and Lawrence Mishel talked about the state of the America worker and examined national trends in wages and productivity as well as the overall strength of the job market.
C-SPAN September 5, 2014 -
Chief among them would be power of the purse. With both the House and Senate appropriations committees under GOP control, Republicans could insert language in spending bills withholding federal funding for the implementation of any number of executive branch initiatives.
The targets could include forthcoming regulations that would update the parameters of overtime pay to cover millions more workers, a rule raising the minimum wage for federal contractors and forthcoming restrictions meant to protect against discrimination in the workplace.
“You can imagine riders that will be written into omnibus bills to block all of them,” said Ross Eisenbrey, vice president of the left-leaning Economic Policy Institute. “The Republicans are opposed to everything the Labor Department has announced.”
Wrapped into massive “must-pass” spending bills, the policy riders could present Obama with a difficult choice between keeping agencies funded and protecting his prized initiatives.
“Does he want to shut down the government over these issues?” questioned Eisenbrey. “I don’t know.”
GOP control of both chambers of Congress could also allow Republicans to pass legislation aimed at beating back labor’s agenda, said Michael Lotito, an employment and labor attorney and co-chairman of Littler Mendelson’s Workplace Policy Institute.
The Hill September 3, 2014 -
Last month, the Conference Board’s consumer confidence index rose to its highest reading since October 2007, two months before the Great Recession began. But a survey released last week by Rutgers University found that Americans are more anxious about the economy now than they were right after the recession ended.
Among the still negative signs:
— The number of people unemployed for 27 weeks or more remains elevated, accounting for nearly 33 percent of the 9.7 million jobless workers.
— Real hourly wages fell from the first half of 2013 to the first half of 2014 for all income groups, except for a small 2-cent increase for the lowest income level, according to the liberal Economic Policy Institute. That minor increase was attributed to minimum wage increases in states where 40 percent of workers live.
Both parties are seeking to exploit those weaknesses and draw contrasts for voters. Republicans argue that the long-term unemployed and the flat wages are the result of Obama administration policies, ranging from health care to the environment.
Obama and Democrats are pointing to the lack of wage growth as a reason to push for a higher federal minimum wage.
“Until we’ve got a Congress that cares about raising working folks’ wages, it’s up to the rest of us to make it happen,” Obama said in his radio and Internet address Saturday.
Politico September 3, 2014