Big wage gains (33%, after inflation) reported by lower-income workers since 1990

Local progressive naysayers paint a false picture that says the only people getting richer are Big Tech Scrooge McDucks. It's not true: Michael Strain unearths historical and current trends in the Wall Street Journal.

"Consider the wages of 'typical' workers--those who are not managers or supervisors. Roughly four in five workers in the U.S. economy fall into this group.

"Have their wages stagnated for decades? No. Since the summer of 1990 (a peak in the business cycle), their  wages have increased by 33%, after accounting for inflation. This is a considerable increase in the purchasing power of typical households.

"The narrative of stagnation is persistent in part because for a considerable time it was true. The post-World War II labor market can be broken up into three periods. From the late 1940s to the mid 1970s, inflation-adjusted wages experienced rapid growth. Then followed two decades of stagnant, and even declining, wage growth. Since the mid 1990s, wages have been largely increasing for typical wokers, even if more slowly than in the 1960s.

"Wages are the most saleint form of compensation, but they are far from the only component of income--that is, of the total flow of resources available to households for spending and saving. The non partisan Congressional Budget Office (CBO) computers a comprehensive measure of inflation-adjusted market income that includes labor market earnings, the value of employer-provided health insurance, and business and capital income. The median household saw market income gains of 21% between 1990 and 2016, the last year for which data are available. The CBO also computes inflation-adjusted income after taxes and government transfers, which grew by 44% for the media household during this period. Households in the bottom 20% saw their post-tax-and-transfer income grow by 66% over these years."

Read the whole thing (behind a paywall) here.

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