Posted on 05/10/2005 2:39:12 PM PDT by nickcarraway
Real wages in the US are falling at their fastest rate in 14 years, according to data surveyed by the Financial Times.
Inflation rose 3.1 per cent in the year to March but salaries climbed just 2.4 per cent, according to the Employment Cost Index. In the final three months of 2004, real wages fell by 0.9 per cent.
The last time salaries fell this steeply was at the start of 1991, when real wages declined by 1.1 per cent.
Stingy pay rises mean many Americans will have to work longer hours to keep up with the cost of living, and they could ultimately undermine consumer spending and economic growth.
Many economists believe that in spite of the unexpectedly large rise in job creation of 274,000 in April, the uneven revival in the labour market since the 2001 recession has made it hard for workers to negotiate real improvements in living standards.
Even after last month's bumper gain in employment, there are 22,000 fewer private sector jobs than when the recession began in March 2001, a 0.02 per cent fall. At the same point in the recovery from the recession of the early 1990s, private sector employment was up 4.7 per cent.
Stagnant salaries push more families towards the breadline
A surfeit of workers and the threat of off-shoring are allowing companies to call the shots on wages.
Go there
“There is still little evidence that workers are gaining much traction in their negotiations,” said Paul Ashworth, US analyst at Capital Economics, the consultancy. “If this does not pick up, it raises the prospect of a sharper slowdown in consumer spending than we have been expecting.”
Economists are divided over the best source for measuring pay increases in the US, since the government releases three main measures. A gauge of average hourly earnings is released with the employment report. This rose by 0.3 per cent in both March and April and 0.1 per cent in February. Even with a slight rise in the hours employees are working, from 33.7 to 33.9, this suggests wages are struggling to keep pace with inflation. The gauge covers non-supervisory workers, about 80 per cent of the workforce.
The Bureau of Economic Analysis figures for personal income showed wages rising at close to 6 per cent in 2004 but slowing down since. This measure also showed wages rising by just 0.3 per cent in each of the past 2 months. This is a broader gauge and includes small businesses and professional partnerships, but it measures total corporate wage bill rather than wages per person.
The Employment Cost Index, seen by some as the most reliable measure, excludes overtime and professional partnerships.
Really? How do you know? Did you see a comprehensive comparison? I would be very interested in seeing it.
Intersting link. So USA is number 17 in the table listed there. So?
You can also see the unemployment rates of 8 other industrialized countries using US methods here.
That's a wise move - because it's only going to get worse. Lots of other people are exiting the computer industry - including students at both the undergraduate and graduate levels. The faculty of many colleges and universities is now heavily weighted with H1B visa holders.
So...what happens to a nation that has no manufacturing infrastructure, has given up its technological edge, and is heavily in debt - in fact, edging up to the nine trillion dollar mark?
Does the term slavery come to mind? That's where we're headed, with wages to match. And it isn't just in the computer fields...it's everywhere.
How do we tell the next generation that we squandered their prosperity - and, perhaps, even their freedom - for cheap trinkets? How do we look in the mirror and admit it even to ourselves? Because that's exactly what we're doing.
If you're using corruption as a barometer by which to judge the relative freedom enjoyed by the populace of a specific country, then India has a long road to hoe.
Building a Whopper is now considered a manufacturing job. You must have missed the memo. Get with the program!
So are you telling me that your decisions in life don't affect your success in life? It must be Bush's fault, or is it Halliburton's.
You forgot to explain the carts being pulled by donkeys. You can go live in India if you want to, but I'm staying put.
More libs talking down the economy.
Yeah. it's that giant sucking sound. Or whatever he said.
Offset by falling costs for goods, thanks in part to Walmart.
It's hard to compete with slavery.
I do not. You can have country with little corruption and little freedom and reverse. It was YOU who provided this link with the table. And USA was on 17 position. So what was your point?
You are confusing freedom with wealth. 100 years ago USA was freerer country and much poorer. And there are richer countries than USA.
Unless we become like them.
Davey Crockett, we need you back to address Congress now.
Well lets see. El Presidente Bush leaves the borders open in a time of War, invites Mexicans to cross it. Slaps the American worker in the face saying their are many jobs they won't fill. And most recently El Presidente now will give our taxes to pay for all the illegals to get free medical at our hospitals.
Bring in 12 million Illegals who work for peanuts. Bring in H1b visas foreigners to take Hi-tech jobs for less pay.
Gee what a surprise that wages are
- a problemo.
In further news, good economic numbers are now detrimental to the society
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