If economy is growing, why aren't workers' wages growing?

Question

Despite the rosy economic news, workers have been completely excluded from the recent prosperity gains, even though they're largely responsible for causing them. The truth is, as corporate profits surged, wages for the vast majority of Americans stagnated or declined.

Wages and salaries now constitute only 45 percent of the country's economy, a historic low. An additional 1.3 million Americans became uninsured last year as health-care costs continued to escalate at rates three times greater than wage growth.

Republicans call this GOOD news?

Forgot to add...

The value of the national minimum wage has dropped to its lowest point in 50 years.

Answer 1

They keep the working class pacified because they can still afford to buy crap and trinkets............ but they can't afford to take time off work, health care, a place to live or to eat well. Ironically they can afford the crap and trinkets only by the suffering of other workers in other countries working in increasing squalor. The price cut to us comes out of their wages (differences in currencies included).
Its a cycle of misery for all the working people in the world and we are all too tired and too poor to change it in a political world that only hears the voice of money.
For them this is good news,
They get servant/slaves they are not personally responsible for even housing...rosy economic news for the conscience less indeed

Answer 2

Stephaniemar and englightenment got it right.

Sway ii and R.J. got it wrong.

And I'd like to add something very important to what searcher said.

"Corporations say they can't raise wages and stay competitive".

This is pure B.S. What all corporations say in their annual reports is that they must pay corporate executives higher and higher pay packages "so they can attract the best executives and remain competitive".

Every time a stock holder questions a corporation about why it's C.E.O. and other executives get exhorbitant pay packages, the answer is always the same.

Even with corporations that have a history of losing money, the C.E.O. gets a pay package (usually with perks and stock options in the multi-millions of dollars) that are off the charts.

Meanwhile, they keep downsizing and reducing working staff, and the workers in turn go home and try to figure how they will make ends meet, or have disputes with their spouces that leads to divorces and broken families, and like Stephaniemar said, they are too busy working their tails off (two and three jobs..I've been there) to do anything about this gross imbalance.

Those who responded by saying it's always been like this should look at the statistics more closely.

C.E.O. pay went from 300 times average workers pay to 500 times avertage workers pay in the last quarter century.

Workers salaries went up very little, and most don't see or hear about pay raises.

When you have gross imbalances like these going on, I say BEWARE.

Falling Towers are not out of the question.

Just what do these overpaid executives do in their spare time?

Play tidley winks?

I'll bet they are plotting to tweak the economy to their satisfaction.

Absolute power corrupts absolutely!

Those who answered that they keep working harder and harder should understand that they are just one merger away from unemployment.

Answer 3

There are several factors
Corporate profits also include globalization and the income made overseas.
Corporate tax subsidies and tax breaks.

The cost of healthcare insurance is rising faster than inflation (just ask your beneifts administrator at your company just how much they pay for your insurance premiums).

Another kicker, do a Google search for "2006 Federal Poverty Guidelines" then click on the top citation: aspe.hhs.gov/poverty/06poverty.shtml

Then add up a full time job at 40 hours time 52 weeks per year = 2080 hours.

Take the household size and the wage for federal poverty guidelines and divide that by 2,080 hours. and you will see what a family has to make just to stay out of poverty.

And that doesn't even include those jobs where you cannot get full time work.

Worker's wages are not growing because corporations state that they cannot continue raising the wages and remain competitive. If the work can be done overseas for much less, the pressure is on the companies to keep the costs down, including labor to remain competitive.

I don't know what the solution is, other than to educate yourself to get a better job.

Answer 4

The core problem with our economy is called "economic inequality." The parameter is actually measured by the government; it has been increasing over many years - meaning that the rich get richer and everyone else - working- and middle-class Americans - get poorer in terms of income and wealth. So at an aggregate national level the economy may look good, but the real issue is DISTRIBUTION of money. This problem is a result of the decay of our democracy, as fully explained in the great new book "Delusional Democracy - Fixing the Republic Without Overthrowing the Government."

Answer 5

The 5 percent unemployment rate looks good in the abstract, the number is low because so many have abandoned their search for work. As a recent report from the Center on Budget and Policy Priorities showed, “employment has grown at an average annual rate of only 0.5 percent since November 2001, as compared with an average for previous comparable post-World War II periods of 2.6 percent” during economic recoveries.

The jobs that are being created in today’s “new economy” are nonunion and low-wage, with few--if any--benefits.

Defined pensions--fixed monthly payments to retirees, one of the mainstays of the American Dream--are on their way to extinction. Just 20 percent of companies offer them today--down from 40 percent in 1980. And the federal corporation that’s supposed to insure those pensions is $450 billion in the red.

Workers are also being forced to bear a share of the fast-rising increases in health care costs--and just 60 percent of employers offer coverage at all, down from 69 percent in 2000, according to the Kaiser Family Foundation.

Answer 6

It is a fact that if you work harder and more efficiently, you will prosper. I have never done better than in the last 3 years. My employees (the ones that work hard and efficiently) have had a 15% per year wage increase. I pay for my own health insurance as do my employees. There is affordable private health insurance out there. You just have to be willing to accept some personal responsibility.

Answer 7

The economy has been in an uptrend since March, 2003 which is precisely when the U.S. invaded Baghdad. (a glance at the chart below will reveal this) .
Mr. Bush is a war president, he goes to bed with war on his mind, the country is on a war footing, and war is supporting the economy.
Are you saying that you think you should be making more money off the war too? Of course not. You just haven't looked at it quite that way.
That's why it's called "Bush's War".

Answer 8

The gap between the rich and poor is growing; that's why worker's wages aren't growing while the overall economy or national income is..

The lower income and middle class haven't felt the real brunt of this yet especially where they have two wage earners and buy inexpensive products at Walmart.

Answer 9

Many reasons. One that we can control is the surge in illegal immigrant workers and legal immigrants companies are being allowed to hire at lower than prevailing wages. American workers are being displaced by cheaper immigrant labor causing industry wide wage regression. You can't ask for more money when someone else will do the job for less. Say hello to open borders and good bye USA.

http://blog.360.yahoo.com/blog-pOypG0szd7Pv_X1rQxw_4qCWpA--?cq=1

Answer 10

My wages have been going up consistently since i was 16. Worked fast food in high school, then got a real job and worked my way up. Its not that hard, you just got to get off your azz and do it instead fo waiting around crying that you arent getting mroe money.

Leonard, how can a personal exoperience testimony be wrong? I am stating exactly what i did to make more money. Its not wrong, the history there is correct.