The first three months of 2013 saw wages fall 3.8 percent – the largest drop in hourly pay in the 65-year history of that statistic – despite an increase in worker productivity. With high unemployment freeing employers from fears that their employees will turn elsewhere, the U.S. recovery has been marked by a decoupling of rising productivity from stagnant wages.
The gloomy milestone partly reflects the predominance of low-wage service jobs in the slow, steady streak of job growth since the recession. Increasing the minimum wage, as progressives in Congress hope to do, could help counter downward wage pressures at the bottom of the earnings ladder.
The recovery has been far more pleasant at the other end of the income spectrum. CEO pay is up to record highs for the second year in a row, at $9.7 million per year on average in 2012. In fact, 121 percent of total income gains from 2009-2011 went to the top one percent of earners – meaning everyone else lost ground.