Rich Are Getting Richer, Poor Are Getting Richer

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4 responses to “Rich Are Getting Richer, Poor Are Getting Richer”

1. 

   Bruce Gerencser

   February 6, 2008

   Dismiss the stagnant wage myth if you wish but to those living with stagnant wages it is a reality.
   In 1978 I started work in a factory for 9.00 an hour.The same job starts out 10-12.00 an hour now.
   If no wage increases for years, coupled with inflation is not stagnant wages, I don’t know what is.
   Stagnant wages continue to push middle class people into the poor class. When everything goes up except wages………..
   I will grant their is upward wage mobility in some parts of our Country. It is not happening here in the manufactering Midwest.
   Bruce

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2. 

   Michael W. Kruse

   February 6, 2008

   Hi Bruce. The comparison of a starting wage thirty years ago and with today’s wage as isn’t meaningful measure of upward economic mobility (yet this is what is commonly done.) A person does not start at a wage and then stay in that position at a starting wage for thirty years.
   The measure is what happened to people who started at that wage in 1978 and where are they today. This study is only one I’ve read over the past decade or more that all point to the fact that most people are significantly better off than they were thirty of forty years ago and they are better off than their parents were at the same stage in life.
   Most doesn’t mean all. Some individuals, for any number of reasons, will not be in the “most” category. Others will do far better than most in the “most” category. That doesn’t negate the reality that the overall economy is effective at improving living standards from one generation to the next.

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3. 

   Bruce Gerencser

   February 6, 2008

   I suspect my view is more localized and current rather than long term. In general, 30 years ago a manufacturing job would have provided a decent middle class income. 9.00 in 1978 was good money.
   External forces such as global trade have forced wages downward. My wife makes a pretty good hourly wage but I suspect it the company had its way it prefers wages at 5-7.00 an hour less than she makes. They are buying out a lot of people, demoting people, all in hopes of lowering the wage cost. I don’t think they are being mean or greedy. The company she works for is going through a difficult time, posting a 10 million dollar loss last year. As a privately held company they can not afford many years like last year.
   One additional thing to add to the discussion. 30-40 years ago families were one-wage earner oriented. It now takes 2 wage earners to maintain the same standard. I wonder if this was taken into account in the statistics?
   Bruce
   PS The bottom line? not enough money and I want more 🙂

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4. 

   Michael W. Kruse

   February 6, 2008

   I sympathize with the circumstances you are in. Part of a dynamic economy is “creative destruction” where some jobs and industries bite the dust as other jobs and industries emerge. That sometimes has inordinate impact on specific geographic areas. Check out the first YouTube clip at my earlier post about the impact of globalizations. It is a tough complex problem.
   You are right about the impact of women working. That is where a lot of the advantage comes from. Men’s wages have not risen much in real dollars over that time but more women work and their wages have been rising. There are other factors as well. The average household at the beginning of the study had 3.1 people but by the next generation had 2.3. There was one less person to provide for. Also goods that did not exist forty years ago (like personal computers and cell phones) came into existence plummeted in cost to the point that they are ubiquitous. But that also means our standard of what is necessary tends to escalate over time. The comparisons are hard to make aren’t they?
   “The bottom line? not enough money and I want more :)”
   Hehehe …. You and me both! 🙂

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