It's real wages, stupid
The New York Times:
That situation is adding to fears among Republicans that the economy will hurt vulnerable incumbents in this year’s midterm elections even though overall growth has been healthy for much of the last five years.The Christian Science Monitor:
The median hourly wage for American workers has declined 2 percent since 2003, after factoring in inflation. The drop has been especially notable, economists say, because productivity — the amount that an average worker produces in an hour and the basic wellspring of a nation’s living standards — has risen steadily over the same period.
As a result, wages and salaries now make up the lowest share of the nation’s gross domestic product since the government began recording the data in 1947, while corporate profits have climbed to their highest share since the 1960’s. UBS, the investment bank, recently described the current period as “the golden era of profitability.”
Until the last year, stagnating wages were somewhat offset by the rising value of benefits, especially health insurance, which caused overall compensation for most Americans to continue increasing. Since last summer, however, the value of workers’ benefits has also failed to keep pace with inflation, according to government data.
"Compared to other advanced economies, our market-driven model yields highly varied results regarding the living standards of our citizens," notes a study by the Economic Policy Institute (EPI), a nonpartisan think tank in Washington.
On Tuesday, the US Census Bureau is scheduled to release data indicating whether poverty last year increased for the fifth year in a row. The official US poverty rate in 2004 was 12.7 percent - that's 37 million Americans.
"Many would argue that it isn't how well off the affluent are in a society that matters most of all," the EPI study says, "but how the most vulnerable fare...."