By Ryan Velez
Feel that your money is counting for less these days? Chances are that you’re not alone. While the cost of living increases as it always has, Bloomberg reports that wages are growing at a snail’s pace by comparison, and women and African-Americans have it even worse compared to other groups.
A report released by the Economic Policy Institute shows that median real wages grew only 0.2 percent over the past year. Wages for African-Americans declined in most wage brackets, while women with graduate degrees made less money than men with only college degrees. By contrast, those in the 95th wage percentile saw an average pay hike of 1.5 percent over the past year.
The strongest areas of growth came among workers in the bottom tenth of the distribution, where minimum wage hikes in some states helped average pay climb 3.7 percent. The problem with this is this is a small departure from the general trend, and there is still a massive wealth gap overall. This plays out with women and African-Americans especially. Here’s how Bloomberg breaks it down.
“The past 17 years have been marked by slower growth for Black workers compared with whites in every wage bracket, according to the report. The gender wage gap also remains stark, though among women, the differential between rich and poor was smaller than among men. Women in the 95th percentile made 5.5 times what those in the tenth percentile made, whereas similarly situated rich men made 7 times as much as their poorer brethren.”
“We’re looking at nominal wage growth that is still slower than you would expect in a full employment economy, slower than you would expect if you thought there were any sort of inflation pressures from wage growth,” said Elise Gould, senior economist at EPI and author of the report.
But what about education, touted as the great equalizer by many? There’s not really much to say, In fact, at the bottom half of the wage distribution for workers with college degrees, wages are lower today than they were in 2007 or 2000.
“You do see college wages rising faster than high school wages, but that differential is not nearly large enough to explain rising wage inequality in the economy today,” Gould said. And when it comes to education, she said it’s far from enough to cure inequality.
“You can’t educate yourself out of gender or racial wage gaps,” she said.