Though six years have passed since the Great Recession officially began in December 2007 and four-and-a-half years since its official end in June 2009, U.S. workers continue to feel the impact of the recession and the very weak recovery through elevated unemployment and through suppressed wages.
The figure below shows that low-wage earners— wage-earners at the 20th percentile— have experienced wage erosion in nearly every state. Between 2009 and 2013, low-wage earners’ wages declined in every state except three (West Virginia, Mississippi and North Dakota). Real (i.e. inflation-adjusted) wage erosion was greatest in Maryland (-$1.24), Massachusetts (-$1.18), and New Jersey (-$1.16) during this period. The national average decline over this period was $0.68 or 6.4 percent. Further, wage erosion was not confined to this portion of the wage spectrum. Wages at both the 10th percentile (“very low wages”), and the median wage saw erosion in forty-five states and the District of Columbia over this period.
This ongoing erosion of lower-income wages is one of the prime reasons that policymakers need to take swift action to support wage growth, such as increasing the federal minimum wage to $10.10, renewing extended Unemployment Insurance, and implementing policies aimed at moving us towards full employment.
