Hello, Raises. It’s Been a While. What Will Make You Stay?
- 6 years ago
Hello, Raises. It’s Been a While. What Will Make You Stay?
Josh Bivens of the Economic Policy Institute replicated the exercise for the economic expansion
that ended with the demise of the housing bubble in 2007: Unemployment, he found, had to fall below 4.6 percent to keep workers in the bottom 10 percent from losing ground.
From the mid-1970s to the late ’80s, they found, an unemployment rate of 6.2 percent
or lower would keep wages at the bottom tenth of the pay scale from declining.
After declining mercilessly since the early 1970s, the hourly pay of private-sector production
and nonsupervisory workers — nurses, cashiers, manufacturing workers on the shop floor and such — hit bottom in 1995 and rose by more than a tenth in real terms over the following eight years.
The hourly wage of workers at the bottom tenth of the income distribution rose
11 percent from 1995 to 2000, according to the Economic Policy Institute.
To keep it closer to full employment, he proposes a set of policies, including raising the Fed’s inflation target from its current
2 percent, creating a fund to bolster job creation in moments of slack and engaging the government in job creation.
Josh Bivens of the Economic Policy Institute replicated the exercise for the economic expansion
that ended with the demise of the housing bubble in 2007: Unemployment, he found, had to fall below 4.6 percent to keep workers in the bottom 10 percent from losing ground.
From the mid-1970s to the late ’80s, they found, an unemployment rate of 6.2 percent
or lower would keep wages at the bottom tenth of the pay scale from declining.
After declining mercilessly since the early 1970s, the hourly pay of private-sector production
and nonsupervisory workers — nurses, cashiers, manufacturing workers on the shop floor and such — hit bottom in 1995 and rose by more than a tenth in real terms over the following eight years.
The hourly wage of workers at the bottom tenth of the income distribution rose
11 percent from 1995 to 2000, according to the Economic Policy Institute.
To keep it closer to full employment, he proposes a set of policies, including raising the Fed’s inflation target from its current
2 percent, creating a fund to bolster job creation in moments of slack and engaging the government in job creation.