March hourly wages were flat again. According to the Wall Street Journal, the 1 percent annualized growth is the weakest seen in a quarter century. This comes on top of three decades of largely stagnant or weak wages for most American workers, even though corporate profits are back to hitting records and CEO compensation is in the stratosphere.
The non-profit Wider Opportunities for Women released a report Friday about what it takes to actually be self-sufficient, a more telling measure than conventional yardsticks of wages. Even though the federal minimum wage is $7.25 an hour ($8.67 in Washington state), it takes more than $14 an hour on average nationally for a single worker to meet basic expenses, plus save for retirement and emergencies.
In Washington, that self-sufficiency number is $8.06 for one adult in King County, $16.62 for one adult and a pre-schooler, and $20.70 for one adult, a pre-schooler and a school-age child.
Unfortunately, in a service economy, many jobs pay low wages, particularly for those with less skills, or those whose skills are no longer in demand. Income inequality is already at levels not seen since the 1920s, by some accounts at record highs. The report says:
Low-wage jobs are unlikely to provide employment-based benefits, which leaves low-wage workers even farther from security. On average, a single American worker who supports two children and lacks access to employer- sponsored health care, retirement plans, or unemployment insurance must earn an additional $2.54 per hour– more than $5,000 per year — to pay for insurance, out-of-pocket health care costs, retirement savings and emergency savings.
This situation will only be worsened for the working poor with widespread state budget cuts. So what if we’re the richest nation in the world.
Today’s Econ Haiku:
No raises at work?
Tough luck, go start a hedge fund
Find a tax shelter