The notion that incomes in America have stagnated over past decades ignores important factors, holds Tyler Coleman of the Foundation for Economic Education. Key is the fact that average real wages have grown by 40% since 1973 when taking inflation into account. Additionally, real consumption per person went up by 74% between 1980 and 2004. The argument that wages haven’t gone up doesn’t consider that they have received health insurance, retirement benefits and more. The Hoover Institution found that around 19% of employees’ compensation was made up of such benefits. Workers have been doing well over past decades.
Even though America’s unemployment rate is about to fall to 4%, the real benefits for workers are rather limited, argues Jared Bernstein of The New York Times. Wages have grown very slowly. Companies have done their best to keep the gains from higher profits while paying workers as little as possible. Meanwhile, consumer prices have soared, leaving the middle class poorer and poorer. With a new economic crisis likely approaching, the middle class could lose overnight any small gains made, while the upper class keeps its wealth. With little power, weak unions and a government that favors big businesses, there is little protecting workers.