Low-wage Workers Take Post-Recession Hit to Paycheck

By Ellis Wazeter, Intern

Since the end of the recession, Americans working in low- and mid-wage occupations have taken a bigger hit to their paychecks than their counterparts in higher-paid jobs, according to a study by the National Employment Law Project (NELP).

Real median wages as a whole dropped by 2.8% during the recent economic recovery — the period from 2009 to 2012. Dig a little deeper, as NELP does, and you find wages paid in low- and mid-range occupations dropped by more than 3%, while wages for better-paid occupations dropped by less than 2%. Workers in five of the top 10 low-wage occupations (restaurant cooks, food preparation workers, home health aides, personal care aides, and maids and housekeepers) received decreases in real median wages of 5% to 7%.

So what does this trend tell us? It tells us that the gap between the richest and poorest Americans is widening even further. Working-class citizens are being paid significantly less in the aftermath of the Great Recession, while those at the top received only small cutbacks in salary.

This is the all more striking when you consider that productivity averaged across all occupations has increased by 4.5% during the same period.

As middle-class workers drift further down the income ladder, we will see a much larger group at the bottom and a ever shrinking group at the top. Trimming the already small paychecks of a vast number of American workers is no solution to shifting our stalled economy out of neutral.

Ellis Wazeter served as an intern with the Keystone Research Center and Pennsylvania Budget and Policy Center in the summer of 2013.


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