The Bureau of Labor Statistics reported on Feb. 24, in “The Compensation-Productivity Gap,” that from 1947-1973 productivity rose 2.8 percent annually and real hourly compensation grew 2.6 percent annually. From 1973-1979 productivity rose 1.1 percent and real hourly compensation grew 0.9 percent. From 1979-1990 productivity rose 1.4 percent and real hourly compensation grew 0.5 percent. From 1990-2000 productivity rose 2.1 percent and real hourly compensation rose 1.5 percent. From 2000-2009 productivity rose 2.5 percent and real hourly compensation rose 1.1 percent.
Since the time of President Reagan’s “trickle down” economic theory and the union-busting philosophy of the Republican Party, companies and investors have reaped profits while they ship the jobs overseas, automate the production floor and use computers to do the research that the better-educated used to do. Real hourly compensation has not kept up with productivity.
Mom/pop and small-business owners remember that those that are still considered to be middle-class are fighting to stay there and those of the working class do not have the money to do anything about it.
My question is, “What do we do about it?”