“The official poverty rate ticking down tells us that the macroeconomy is strong,” Josh Bivens, the chief economist at the Economic Policy Institute, told BI in a statement. “The fact that it is still 11.1% at near-full employment and the SPM rose tells us the U.S. system of anti-poverty programs needs strengthening. These programs keep tens of millions out of poverty, but if we expanded them, they’d bring tens of millions more out of poverty.”
Business Insider
September 16, 2024
According to the Economic Policy Institute, the final rule will benefit 4.3 million workers, 56% of whom are women and 24% of whom are workers of color.
According to the institute, the final rule will result in a transfer of $1.5 billion annually from employers to workers in increased pay. While that increase in wages will be enormously impactful to affected workers, according to the institute, it represents well under one-tenth of 1% of total wages and salaries in the U.S. economy.
The Business Journals
September 16, 2024
“Today’s data highlight the extraordinary strength of the recovery from the economic crises caused by the pandemic, a recovery driven by policy choices — particularly large fiscal relief and recovery packages — that aimed to quickly heal the labor market,” Elise Gould and Josh Bivens, economists at the left-leaning Economic Policy Institute, noted in a Tuesday research note.
“The rapid growth of household incomes charted in today’s data is powerful evidence that the policy approach of recent years was the right choice,” they added.
CBS Moneywatch
September 16, 2024
MarketWatch
September 16, 2024
The Harris campaign’s take was echoed by economist Heidi Shierholz, who leads the Economic Policy Institute, a left-leaning nonprofit think tank.
“Trump’s new playbook is to claim he won’t tax the earnings of the very groups of workers whose earnings he already has a clear record of undermining,” noted Shierholz, who was formerly chief economist at the Department of Labor.
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Further, Trump’s proposal could wind up mostly benefiting the highest-paid Americans, according to Shierholz.
“To allow their salaried, overtime-exempt workers to get the tax cut, employers could easily switch them to hourly,” she noted. “It is not unreasonable to imagine that this policy would lead to a world where corporate CEOs earn $4,000 an hour plus $6 million in overtime.”
CBS Moneywatch
September 16, 2024
Other critics noted that the proposal would be easy to abuse. “Trump’s claim that he would exempt overtime from taxes is deeply unserious. This policy would be incredibly easy to game,” said Heidi Shierholz, who heads the liberal Economic Policy Institute. “Employers could (and would) easily switch salaried, overtime-ineligible workers to hourly—and set the hourly wage so that, with overtime, they are paying no more than they paid before—and allow their workers to get the tax cut.”
Shierholz added that the winners from the plan would likely be high-income. “[A] huge share of the expenditures on this tax exemption would go to very highly paid workers,” she said. “And good lord, big-firm lawyers would love this.”
Fiscal Times
September 16, 2024
“Trump has a long anti-overtime record,” Heidi Shierholz, senior economist at EPI Action, a labor-oriented advocacy group, said in a statement. “While president, he stripped overtime protections from millions by refusing to defend the Obama-era overtime rule in court and instead publishing his own, much weaker rule.”
By shifting the income eligibility level at which the Labor Department requires workers be paid overtime, Trump helped push an estimated 3.2 million workers out of the category designated to get the extra pay, usually at time-and-a-half, Shierholz’s analysis showed.
An additional 5.2 million workers were subject to losing overtime payments from businesses that could misclassify them as managers or executives, a frequent maneuver employed by businesses, Shierholz said. And rules proposed by Project 2025 — written for a new Trump administration by Trump allies and former aides, but which the former president insists he will not follow — “would strip overtime protections from at least 8 million [additional] workers,” Shierholz said.
LA Times
September 16, 2024
“The vast majority of hourly workers are automatically overtime eligible, regardless of how much money they make,” said Heidi Shierholz, who was the chief economist at the Department of Labor under the Obama administration.
The relative ease with which hourly employees can earn overtime could create a huge tax incentive for more Americans to reclassify themselves as hourly workers. The cost of the tax cut would depend on whether such legislation limited the ability of corporate executives or high-paid lawyers to modify their own compensation and make a chunk of it tax free.
New York Times
September 16, 2024
Economists call this “occupational segregation.” There’s less of it than there used to be, noted Heidi Shierholz at the Economic Policy Institute. But it’s still a big factor in the gender pay gap.
Similarly, “women shoulder disproportionate responsibility for caregiving in our society,” she said. “That is changing, but it is still the truth.”
Marketplace
September 12, 2024