Income inequality chart of the day

By Felix Salmon
July 7, 2010
Catherine Rampell features this chart today, showing how wage inequality has increased over the past 30 years, especially for men. But in fact what we're seeing here understates how bad things have been for most men over the past generation. If you go to the source, this chart only shows data for people working full time. And, at least when it comes to men, that's much less common now than it was in 1979.

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Catherine Rampell features this chart today, showing how wage inequality has increased over the past 30 years, especially for men. But in fact what we’re seeing here understates how bad things have been for most men over the past generation. If you go to the source, this chart only shows data for people working full time. And, at least when it comes to men, that’s much less common now than it was in 1979.

The labor force participation rate for men 20 years and older was 79.8% in 1979; today, it’s just 74.4%. And I don’t think that most of that drop can be explained in terms of a larger number of students: the rate was as high as 77% as recently as August 2000, and then dropped to a low of 73.9% in December 2009.

You can be sure that most of the drop in labor force participation is coming from the less well educated Americans. Which means that if you’re a man with less than a high school diploma, your real wages have fallen by 28% over the past 30 years if you’re lucky enough to have a job at all. At the same time, the number of such men without a job has been growing steadily. It’s a depressing set of data, and there’s no sign of it turning around in the foreseeable future.

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Comments
11 comments so far

I just finished reading your colleague’s article about America’s two speed economy and am now thorouly depressed!

This, I think, is the truly the brave truth about our situation: “Tom Wilson, the CEO of Allstate (another underwriter of the festival), made the essential — and brave — point that the fates of American business and American society may be starting to diverge. “I’ll get them [workers] anywhere in the world,” Wilson said. “It is a problem for America, but it is not necessarily a problem for business. I have workers in Belfast, I have workers all over the world. American business will adapt.”

It certainly seems that the standard of living in the USA is now unsustainable. Business is content to move those jobs it can to low cost areas. Truly, the interests of American businesses (read senior management and shareholders) and US society (middle class) have diverged. Why didn’t we see this coming? Why did we think we could bring the rest of the world out of abject poverty while not giving them our low-skill jobs? Why did we think they wouldn’t want exacly what we have and compete vigorously for it?

This “free trade” was a colossal failure of policy for the US middle class made worse by the absence of any strategy to deal with completely predictable repurcussions. It worked for a while, but now what?

Posted by silliness | Report as abusive

Felix, the plight of young men is worse than your figures show. In fact the overwhelming majority of college graduates these days are women.

Feminism is made obsolete by a new generation of underachieving men!

Feminists blind enough to be upset about the wage gap are looking at 40- and 50-somethings. If they were looking at 20-somethings they would see something shocking, a reversal of roles. A feminist in 2010 is someone who takes pleasure in kicking a man while he is down.

We are already in a brave new world where many high achieving women are having a hard time finding a man who is up to snuff. Good luck to them.

Posted by DanHess | Report as abusive

Gender/employment statistics get complicated by voluntary choices made in two-parent-plus-child(ren) families. There are many more men staying home as the primary caregiver than there were five or ten years ago. As DanHess points out, women are more likely than men to hold college degrees, at least as likely to hold high-paying jobs. It is no longer automatic that the woman will be the one staying home with the kids.

Of course other families would prefer to have both parents working, if they could find jobs.

Posted by TFF | Report as abusive

I have it on higher authority that career women prefer men who don’t give too much of a toss about money and have haircuts like Reuters’ bloggers. I’d draw you all the graph to go with this but am, or hope to be, a little busy right now.

Posted by HBC | Report as abusive

I like to skew neat little charts with female backlash. I am not a ‘feminist’. (Wow Dan… blaming females for men being underachievers? Interesting)

You can also bet just as well, that the children of well to do’s and middle class are less likely to be as motivated as their parents.

Their parents may have worked their butts off starting from menial jobs, working more then one job and trying and failing before becoming success or owning a business whereas the generations from the last 30 years started to live with their parents longer, languished in schools and got masters in Philosophy, smoked a lot of pot and possibly took interesting but useless classes … because they could..

http://www.toptenz.net/to-10-useless-col lege-classes-degrees.php

or, dropped out, drank their way through College and are more expectant then the generation before, that everything will fall in their laps. Living with parents does not teach you how to ensure you have left over disposable income and how to get your laundry done other then leaving it on the floor, but it surely is a convenience.

Even before the recession, adults living at home increased 50% in the united states, from 1970 to 2006. Being they all have cars, take a vacation twice a year and mom does the laundry, who needs to work full time or get a high paying job? And the number have climbed these last few years, and for legitimate reasons. But the leaving home curve, after being babied is too much for a lot of young men (and women) and they are NOT willing to take just any old job to get by and have to work to survive. They want it all, but not if it takes too much effort.

Being the mid seventies was the first time that females began to be ‘able’ to work in mostly male oriented jobs, and the 80′s was when a women was first able to be in a career where she was ALLOWED to advance and actually be the boss, you can bet there was a steep incline. We were not just GIVEN the jobs. We had to work 10 times harder.

I started working when I was 12. I left home at 17. My parents bought my books for college. I worked 2 jobs to start. i lived with as many as 4 other people until I could afford my own home. I worked hard to have it all, and I did have it all.

I deserved everything I fought and worked for. I was the main bread winner. I paid for my ex’s upgrade training when he lost his job and I was the main bread winner for several years after, until he worked his way back up. Oh wait… because I didn’t accept that I should be in the kitchen and pregnant, does that make me a feminist?

Ok back to the issue here, which is males are still the bread winners in many homes and poorly educated young men are really having a hard time finding work because manufacturing jobs are outsourced. I agree Nafta hasn’t been the answer. When it comes to jobs, the states need to individually look at the census stats and find out how to keep them there and get them jobs.

Instead of more colleges for academics, perhaps the trades should focus, so more trade schools. More high-school trade shops to allow younger people choices other then academics, more apprenticing, grants and incentives for business to work with high schools for half days as well as business and tax incentives for businesses who hire new hires.

There are already tons of Grants out there, for students, small businesses and start ups. Smart and rich people know all about them. Wouldn’t it be nice if the Government had agencies in each state who worked with communities to make sure they were assisted in filling out the forms and that the money goes to those who need it most and those areas where the 28% lie?

Get the hell out of that war, and free up the money to give grants for new startups. (THAT war is a depressing thing)

And I would apologize for going on and on, but I can’t. I enjoyed it far too much.

Posted by hsvkitty | Report as abusive

HSVKitty –

I did indeed lament the failures of young men today.

But “blaming females for men being underachievers”?

I did nothing of the sort.

But you see, between 1970 and 2010 (a huge, 40 year span) something big happened. The gender gap among young people is reversed. Young women are doing great, mostly but young men on average are not.

Just noting that feminism apparently already ran right through the endzone, crashed through the marching band and kept right on running, not realizing that it has already scored the touchdown.

I don’t diminish your achievements of the 1970s and 1980s, but young men, not young women, are now in the gutter. That is the crisis of our time. I commend you on conquering the crisis of an earlier era.

Posted by DanHess | Report as abusive

The elites who run US institutions (including business, education and the media) are only interested in expanding their own power and global reach, and could care less about America’s economic and social development. Consider off-shoring and the H1B visa program as well as the increasing numbers of international students at top US universities. It would not be that hard to create incentives to spur the creation of more employment and educational opportunities for American citizens. Until we do, expect more inequality and the strife that accompanies it.

Posted by howardhonk | Report as abusive

DanHess, our high schools today reward “effort” and “neatness” with 40% or more of the course grade. A student who turns in two pages of carefully organized work will receive a better grade on the assignment than one who turns in half a page of illegibly scribbled mess.

Of course, girls are far more likely to be the ones turning in the careful work. Partly the age, partly the culture.

If you look at test grades (both in-class exams and standardized testing), however, you see little gender difference in their comprehension of the material.

I suspect the new gender gap is an issue that can be addressed within the schools, if we simply acknowledge it and give it attention.

Posted by TFF | Report as abusive

There is certainly a correlation between education and income, but I wonder about causation. I suspect that both may be caused by one or more other characteristics. Many men of my era (toward the beginning of that time period) left school for jobs in the steel mills and auto factories and a “guaranteed” middle class life. When those jobs went away, the adaptable moved on, while the inflexible fell into the lower economic classes.

Perhaps that’s what education does – makes us more adaptable. Or perhaps there is a characteristic that makes us adaptable, and we pursue education to develop that characteristic.

Posted by Curmudgeon | Report as abusive

The conundrum here seems to hinge on two things, plus ones understanding or lack thereof when it comes – in some future Golden Age, perhaps – to feminism.

These two things are: a) what one means by an economy which has been increasingly virtualized and with which, as in pantomime, everyone’s more or less trying to mesh after a fashion that demonstratively stops short of crossing the line into their idea of overt prostitution, but covertly often doing so anyway; and b) whatever passes for education in a pseudo-educational landscape dominated by parasitic concerns of its own, academic priorities having been trivialized to rolodexing, and any role the scholastic clientele – students in general – might play, downgraded to that of funding units.

The economy, erst synonymous with the navigational capabilities of mainly male captains, totally surrendered its masculine bearings under the hollow step-fatherly figurative war(d)ship of Reagan whose contempt for feminism and minorities was off the charts, trickling inexorably down into the ‘common’ language and conflicted attitudes of our times. America’s economic moorings were cut loose under Bush1 and Clinton.

Then the whole regatta was finally blown outta the water under Bush2, whose contempt for education and culture may by some be given an A for effort to outdo that of his predecessors but, like the wee man’s spiritual godfather Reagan, never quite the boot he deserved.

The US economy has, like American television, become like an endless procession of pseudo-entrepreneurial soap opera award shows for the terminally talentless and hee-haw studio applause teams. For all its overt vacuousness, the economy’s main job right now consists of making itself appear inescapable. If you believe in it, or fairies, it is.

Into this mess may delve a hapless student body, doomed by debt and natively ill-equipped to ideate, never quite sure whether they should’ve bothered studying in the first place when there’s nothing worth learning manifested anywhere nearby. That’s gotta suck.

It’s every girly-man a log-cabin bipartisan orphan born under a bad sign, and every woman for herself. So, I ask you, whom does it actually surprise when good graphs go wild?

Posted by HBC | Report as abusive

There are more variables than the figures cover.
How many “2-income” families are 2 income by choice, and how many have no choice?
How many men over 50 who are out of work will ever get a job again?
Just within the educational segmentation, what are the differences by decade?

Posted by Neil_in_Chicago | Report as abusive
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