What caused the change in wages over the past 20 years ?

[Modelworks]

If you look at charts like this one:

Up until about 20 years ago wages were pretty much in line with productivity and increased each year , then all of a sudden wages stopped increasing yet business was able to produce more and prices for goods increased. Basically business benefited while the workers got shafted. I think that has to do with the economic problems more than anything else. People had to borrow to buy the same things they had before because wages lost pace with cost.

So what caused it to occur ? I heard some people say it was computers and automation that allowed factories to turn out more and need less skilled workers so there was no need to increase wages . The problem with that is in some countries they have kept the wages increasing over the years even though they have modernized the factories and production. So what is it we are not doing ?

 

[drebo]

Government regulation. For the most part. Businesses have to spend more and more to make sure they're "compliant". That leaves less for margins and less for payroll.

 

[Carmen813]

What change in wages?

 

[Jhhnn]

It's teh Ebil Gubmint!l.

Hogwash. It's due to the change in income distribution, with a lot more going to the tippy-top, largely a consequence of offshoring and the demise of unions...

Top tier taxcuts speed the process, providing the capital for offshoring, and the incentive to keep more for oneself rather than paying employees better...

 

[nageov3t]

What change in wages?

I lol'd

and then I cried because despite getting a half-decent raise this year, my take-home per paycheck went down because health insurance costs went up more than my raise gave me.

 

[soccerballtux]

Government regulation. For the most part. Businesses have to spend more and more to make sure they're "compliant". That leaves less for margins and less for payroll.

Hogwash. It's due to the change in income distribution, with a lot more going to the tippy-top, largely a consequence of offshoring and the demise of unions...

Top tier taxcuts speed the process, providing the capital for offshoring, and the incentive to keep more for oneself rather than paying employees better...

Alternatively we could keep Unions and the entire business goes under. Then everything moves offshore and we have to import it. Brilliant idea sir!

If you hadn't noticed, executive pay didn't skyrocket till Sarbanes-Oxley was passed.
http://online.wsj.com/public/articl...yvsBK6_z44vVXHJHXA_20060607,00.html?mod=blogs
"blah blah WSJ Rupert Murdoc blah blah", the article raises valid points.

Deal with SarbOx, pay comes back down. Don't, and Executive's butts are on the line for things guys 4 levels of management removed do to cook the books. Gotta have compensation when your head is on the line should the company go belly up through no fault of your own.

Typical uninformed proletariat rant about the guys that get paid more. And, might I add, typical lack of content and supporting facts to the comment as well. What more would I expect from someone on the internet...

 

[PrinceofWands]

Government regulation. For the most part. Businesses have to spend more and more to make sure they're "compliant". That leaves less for margins and less for payroll.

The opposite actually. The 80s were the start of the most serious deregulation and tax haven/breaks for the wealthy since the 20s. Without rules to keep control of business, and progressive taxes to keep wealth hording under control, abuse of the common man is imminent.

 

[PrinceofWands]

Hogwash. It's due to the change in income distribution, with a lot more going to the tippy-top, largely a consequence of offshoring and the demise of unions...

Top tier taxcuts speed the process, providing the capital for offshoring, and the incentive to keep more for oneself rather than paying employees better...

Good point. I agree that offshoring was also a MAJOR factor in wage stagnation. The loss of unions was concurrent to the loss of manufacturing and industry, which was already covered under 'offshoring'. There aren't unions because there aren't enough rules protecting them and employees, and too many ways businesses can get around fair treatment of employees by just hiring them in other countries (and keeping all the savings for executives and investors of course).

 

[Hacp]

Competition from China and India and Japan in the early part of the decade. The US spent too much time nation building in those years and too little time worrying about ourselves.

 

[Udgnim]

proliferation and advancement of computer technology?

 

[Patranus]

Ah, a graph put together by the AFL-CIO.

Note the graph is not sourced in the OP and is also not sourced in the article it is linked from.

Link to the original article.
http://www.irle.berkeley.edu/events/spring08/feller/
I wonder what the lawyer from the AFL-CIO is advocating for in the article

 

[woolfe9999]

The wage calculation typically does not include the value of employee benefits. The rising cost of healthcare premiums, at a rate much faster than inflation, has put some downward pressure on monetary wages. The employer may be paying the same, in real adjusted dollars, as he did 20 years ago, but the excess cost of health premiums over inflation is a substitute for what would, instead, be a higher wage.

It isn't just the increase in healthcare costs though. The actual amount of real benefits has increased as a share of total compensation over the past 30 years.

- wolf

 

[PrinceofWands]

The wage calculation typically does not include the value of employee benefits. The rising cost of healthcare premiums, at a rate much faster than inflation, has put some downward pressure on monetary wages. The employer may be paying the same, in real adjusted dollars, as he did 20 years ago, but the excess cost of health premiums over inflation is a substitute for what would, instead, be a higher wage.

It isn't just the increase in healthcare costs though. The actual amount of real benefits has increased as a share of total compensation over the past 30 years.

- wolf

Do you have support that shows this is true in low end jobs? Let's remember that almost 55% of individuals make less than $30,000/yr, and in low end jobs like that there's often little to no benefits package. In fact there's often not even health care benefits, or if there are it's a super expensive option that the employee doesn't take because they can't afford it. Vacation is often not earned for a year or two in lower end jobs. There's seldom much investment matching. What exactly does a $10/hr job offer as benefits that compensate such a reduction in wages?

 

[PrinceofWands]

Wages are down because the middle class was made up of manufacturing, industry, technical, union, and other similar jobs. The middle class has been eroded and merged down into the lower class as service industry low value jobs are all that remain. With precious little else out there, the few middle that remain have no choice but to accept stagnant wages while the upper middle makes a run to true upper class status, and the uppers exact an ever higher toll from the rest of us.

 

[Double Trouble]

Wages are down because the middle class was made up of manufacturing, industry, technical, union, and other similar jobs. The middle class has been eroded and merged down into the lower class as service industry low value jobs are all that remain. With precious little else out there, the few middle that remain have no choice but to accept stagnant wages while the upper middle makes a run to true upper class status, and the uppers exact an ever higher toll from the rest of us.

Sad to see such rampant class envy in this society, especially since you're probably part of a very large group of people with class envy with very little understanding of the real world and how things work.

 

[StageLeft]

Sad to see such rampant class envy in this society, especially since you're probably part of a very large group of people with class envy with very little understanding of the real world and how things work.

I didn't see class envy in his post. He may have exaggerated with "precious little out there", but the trend is as he said. the middle and lower classes have been hugely stagnant for years now while the upper tiers of society become richer at an increasing pace.

There are many reasons. One is certainly government in the back pockets of corporations who excessively lobby to the benefit of their upper management and shareholders.

 

[Jhhnn]

Typical uninformed proletariat rant about the guys that get paid more. And, might I add, typical lack of content and supporting facts to the comment as well. What more would I expect from someone on the internet...

Righties are sooo tedious. You act as if this discussion has no roots, as if it hasn't happened many, many times before, As if supporting information hasn't been linked ad nauseum.

Quote 1 hatchet-job apologism from the WSJ and it's all better, right? Don't let facts interfere with the formulation of your opinion, ever, because your wannabee ego won't allow you to be wrong, ever.

Income share of the top 1% has grown enormously of the last 30 years-

http://www.taxfoundation.org/news/show/250.html

Perhaps I should interpret the share of income and tax rate numbers for you, sir?

Like I said, wingnuts don't need no steenking facts, because they have faith, because they *Believe*, because their blindness is quite willful.

 

[soulcougher73]

Outsourcing.

 

[StageLeft]

Righties are sooo tedious. You act as if this discussion has no roots, as if it hasn't happened many, many times before, As if supporting information hasn't been linked ad nauseum.

Quote 1 hatchet-job apologism from the WSJ and it's all better, right? Don't let facts interfere with the formulation of your opinion, ever, because your wannabee ego won't allow you to be wrong, ever.

Income share of the top 1% has grown enormously of the last 30 years-

http://www.taxfoundation.org/news/show/250.html

Perhaps I should interpret the share of income and tax rate numbers for you, sir?

Like I said, wingnuts don't need no steenking facts, because they have faith, because they *Believe*, because their blindness is quite willful.

fyi you quoted the wrong person

 

[Vic]

The OP's graph fails to account for the considerable increase in the value of employee benefit packages since the 70s. Factor those in, and total compensation has increased at pace with productivity. So the graph is simply misleading. Like they say: lies, damned lies, and statistics.

 

[Craig234]

Sad to see such rampant class envy in this society, especially since you're probably part of a very large group of people with class envy with very little understanding of the real world and how things work.

You pretty clear have it backwards who understand how it works.

Anyone who says 'class envy' is instantly presumed to be an ignorant right-wing cult parrot.

 

[Craig234]

The wage calculation typically does not include the value of employee benefits. The rising cost of healthcare premiums, at a rate much faster than inflation, has put some downward pressure on monetary wages. The employer may be paying the same, in real adjusted dollars, as he did 20 years ago, but the excess cost of health premiums over inflation is a substitute for what would, instead, be a higher wage.

It isn't just the increase in healthcare costs though. The actual amount of real benefits has increased as a share of total compensation over the past 30 years.

- wolf

'May be paying the same' - they're not close, IMO. Anyone have a chart including benefits packages?

 

[Robor]

Ah, a graph put together by the AFL-CIO.

Note the graph is not sourced in the OP and is also not sourced in the article it is linked from.

Link to the original article.
http://www.irle.berkeley.edu/events/spring08/feller/
I wonder what the lawyer from the AFL-CIO is advocating for in the article

Says the guy who posts more partisan right wing blog WOT nonsense than anyone on the forum. Excuse me if I

 

[Robor]

Sad to see such rampant class envy in this society, especially since you're probably part of a very large group of people with class envy with very little understanding of the real world and how things work.

Class envy? How about reality?

 

[Robor]

The OP's graph fails to account for the considerable increase in the value of employee benefit packages since the 70s. Factor those in, and total compensation has increased at pace with productivity. So the graph is simply misleading. Like they say: lies, damned lies, and statistics.

I don't know about you but the companies I've been working for are not increasing benefits. Pension packages are almost non-existent, 401K's match less, some companies offer none or little health coverage, what they do offer is really expensive, the list goes on and on.