U.S. Workers Are Making More Money, but There’s a Catch

“Yeah, Brad, the pay is great, but I haven’t seen my wife and kids in seven years!” (Image retrieved from quickmeme.com.)

Most Americans are making more money than they did 25 or 30 years ago. They are working more hours, too. On the face of things or in a vacuum, these trends might seem like fortuitous circumstances for the workers of the U-S-of-A. When we sift through why these phenomena are occurring, and how they may be related, meanwhile, our glasses may not appear quite as rose-colored regarding the employment picture in this country.

A recent report by Jacob Passy for MarketWatch sheds some light on why higher wages and longer hours might not be all they’re cracked up to be. As Passy explains, citing data from the Economic Policy Institute’s Bureau of Labor Statistics, average annual earnings for people in their “prime working years”—age 25 to 54—have increased by some 30% from 1979 to 2016, even after inflation. The bad news? This is often not mediated by an increase in wages/salary, but because people are working more to meet increased costs of living. To make things worse, and as you might expect, the extent to which people need to work to offset their expenses increases as their earnings level goes down. While all income groups saw an increase in hours worked in 2016 relative to 1979—on average, 7.8%—American workers in the bottom fifth of earners saw an increase of 24.3% over the same span, easily dwarfing the rates of increase for top earners (3.6%) as well as representatives of the middle class (9.4%). This is particularly problematic because there are limits inherent in any employment situation. For starters, there are only so many hours in a day, not to mention so many hours that establishments are liable to be open for business. Couple this with the notion that most workers do not make their schedules—rather, hours tend to be set by supervisors—and that availability of shifts might be further constrained by corporate strategy and concerns about profitability, and you’ve got quite the situation on the hands of American workers.

Not depressing enough yet? Wait—there’s more. As Passy reports, and as EPI researchers also found looking at data from the same span, more men in their prime working years are “disconnected from work.” Translation: they’re unemployed and not looking for work. From 1979 to 2016, the rate of men in their prime disconnected from work rose from 6.3% to 11.9%; women saw a decrease over that span from 29.8% to 24.1%. Once more, the picture is bleaker for certain populations, namely people of color, and specifically, black men. According to the EPI statistics, black males are twice as likely as white and Hispanic men to not be working, and when they are working, they work fewer hours, on average. Imaginably, employment rates are worse for those without a college degree, let alone high school diploma or GED equivalent.

This all comes to a head when talking about financial situations of workers across ethnicities, as Passy goes on to explain. Citing additional research by the Pew Research Center, he writes that, on average, white families possess just over $120,000 more of wealth than families of color. In addition, concerning the disparity in earnings, African-American and Latino households are more likely to be financially “underwater,” and children from poorer households—which does not necessarily mean those from minority populations but frequently does—are found to be less likely to achieve educational milestones that lend themselves to career success and increased wages. Talk about your vicious circles.

Skeptics of this information or others who would dismiss the trends about blacks and Hispanics/Latinos might point to stereotypical notions of them being deficient in moral fiber, lazy, and/or unintelligent. This is, of course, racist and unmitigated bullshit, but it’s an explanation that suffices for many, and even if I were to question it with logic and statistics, they would be loath to believe it, so let’s just leave that line of thinking aside and try not to slam our heads against hard objects out of frustration. On the work side of things, however, that people are working more irrespective of class or ethnicity is more difficult to explain than by simply denigrating minorities or the poor for their perceived lack of effort. Though I’m sure that won’t stop some people from trying. After all, people are working more. They’re being more productive. Gosh darn it, they’re illustrating the American spirit with their can-do attitude. U-S-A! U-S-A!

Maybe. But this also might be a space to consider how this feeds into concerns about the work-life balance in this country relative to other developed nations. Kerry Close, in a 2017 article which appeared in TIME Magazine, explored in a case study of sorts how France differs from the United States on its approach to work schedules and work-life balance. In terms of the raw numbers, yes, Americans do work more than their French counterparts, working an average of 1,790 hours per year to France’s 1,482, as measured by the Organisation for Economic Co-operation and Development (OECD). American workers are also more productive in terms of raw output and income per capita.

As Close tells, though, this was not always the case, and up until as recently as the 1970s, French workers actually put in more hours than we did. What led to this shift? While it may be no surprise to advocates of organized labor, the efforts of unions and collective-bargaining agreements were essential to this movement. Citing the research of Dartmouth economics professor Bruce Sacerdote, Close explains that in response to rising unemployment in the 70s, French unions advocated a “work sharing” policy that would decrease the number of hours logged by individual workers in favor of more people being afforded the ability to work. These policies, owing to their appeal, helped unions grow stronger and represent more workers, leading to the securing of valuable time off, which persisted even after the employment situation in France improved. As Sacerdote notes, today, France has 25 federally-mandated vacation days, allowing most employees to be off at the same time.

25 days off? That’s preposterous, you may be saying! How do those snail-eating Frenchies get anything done? As with isolated statistics about more hours worked and more money made by American workers having the power to mislead, that the U.S. exhibits a higher raw output and income per capita than France belies the benefits that the latter country experiences by offering more vacation time and other perks. Firstly, concerning those mandated days off, having most employees off concurrently means productivity doesn’t suffer in the same way as it does when people stagger their vacations in the United States, such as with the informal “break” that occurs between Christmas and New Year’s. As for the higher output per capita, again, this is a question of productivity. Giving people a more liberal amount of time away from work and permitting them to fully disconnect from the office—yes, even from work E-mails—tends to make them more productive when they are in the office. Thus, as Close indicates, it is not so much that European culture is by nature inclined to a more relaxed workplace, but that systems like that of France’s evolved out of a response to specific economic circumstances and out of genuine concern for the standard of living of a wide swath of the nation’s workers. In other words, while it’s a good thing that Americans work as hard as they do, in this instance, there certainly would seem to be such a thing as too much of a good thing.

At the heart of this discussion about benefits and stagnant wages is the role that unions play in negotiating for fairer wages, increased benefits, and safer working conditions, among other things. In saying this, I acknowledge public opinion on unions in the United States tends to be mixed; though Gallup polling on approval of labor unions has more recently seen an uptick in favorable responses, not long ago, in the wake of the Great Recession, approval had plummeted to a sub-50% level. Christ, my own father once uttered the phrase, “Unions are what’s ruining this country,” and when he found out Bernie Sanders was a backer of organized labor, he quickly dismissed any idea of supporting him. Just stab me in the heart, why don’t you, Pops?

Perhaps more significant within the same research were divides in responses based on party affiliation, as well as the consensus outlook on the future of unions. On the subject of Democrat-vs.-Republican splits, while favorability of unions has risen even among GOP supporters, Democrats (81%) are about twice as likely as Republicans (42%) to approve of unions, with independents squarely in the middle (61%). Meanwhile, on the subject of union influence and strength, while more respondents expressed the desire to see unions have more influence than they did when Barack Obama was in office, more than 70% of those surveyed expect unions to become weaker or stay the same. This isn’t particularly inspiring noting labor union participation as a subset of all American workers has steadily been on the decline over the past 40 to 50 years, and even less so when you consider the middle class’s share of the nation’s income has been on a similar decline over the same span.

This is before we even get to the case now before the Supreme Court in Janus v. AFSCME, which once against pits unions against the wealthy and conservative leaders of industry, not to mention the Republican heads of state and lawmakers who actively aid and abet the weakening of unions. The case, which specifically involves whether or not public-sector employees should be mandated to pay union fees even if they are not members and how this relates to First Amendment rights, is another iteration in the larger battle over what is termed “fair-share” representation by labor advocates. Opponents of these fees such as Illinois governor Bruce Rauner (Mark Janus, plaintiff in the case, is a resident of Illinois) and other GOP figures who preside over statehouses have been instrumental in advancing “right-to-work” legislation which limits the extent to which unions can collect dues from non-members or compel employees to join unions.

Roberta Lynch, executive director of the American Federation of State, County, and Municipal Employees Council 31, and others of a like mind, counter that fair-share fees are warranted because union leaders advocate on behalf of members and non-members alike. The case is expected to be decided along ideological lines, which could prove disastrous for public-sector unions, assuming Neil Gorsuch joins other conservatives in voting to undercut their power. Plus, by invoking the First Amendment, the precedent set by this ruling could pave the way for any number of legal challenges to other dues of a similar nature outside the realm of labor law. Or it could strengthen union resolve and end up blowing up in the faces of the conservative donors backing Janus (yup, where there’s anti-union smoke, there’s likely to be a Koch Brothers fire a-burnin’). Needless to say, the results could be very messy indeed.

Regardless of your opinion on unions, that wages have stayed mostly flat while the cost of living has gone up, and that people are making more money and working more hours, are two trends which aren’t up for debate. That there is a presumably causal relationship between these observed effects makes this all the more, as Jacob Passy puts it, “depressing.” If earnings are being used to offset expenses and people have to work more and more to make ends meet, this limits a family’s ability to save and prepare for the future, let alone spend time together. For all the talk of “making America great again,” the American dream, for many, is seeming like a pipe dream more than ever.

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