Change in median earnings 1998 to 2013 in USA vs. UK
from David Ruccio
David Blanchflower and Stephen Machin use this chart to illustrate the fact that, in the United Kingdom, “The real wages of the typical (median) worker have fallen by around 8–10% – or around 2% a year behind inflation – since 2008.”
But, as we can see, the situation for workers in the United States has been more dire, for a longer period of time: real median weekly earnings are basically unchanged for the past 25 years.
The United States therefore serves as a warning in terms of the question Blanchflower and Machin pose for the UK:
Firms have started to perform better, so their ability to raise pay levels may have increased slightly – but so far we see no evidence of any change in their willingness to pay. In line with our discussion of inequality, this does raise a key question – why, if nothing changes, wouldn’t they continue to keep any gains to themselves? It stretches credulity to believe that all of a sudden bosses will hand over pay increases to their workers when they have shown no inclination to do so for several years.
Or, in the case of the United States, for several
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—– look inside —– $5.94 / $20.00
—– look inside —– $4.90 / $8.00
—– look inside —– $15.99
—– look inside —– $5.99 / 12.99
—– look inside —– $5.93 / $12.99
—– look inside —– $4.97 / $9.90
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Gerson Lima / Maria Alejandra Madi
Edward Fullbrook and Jamie Morgan
————— Michael Hudson ————–
Maria Alejandra Madi / Jack Reardon
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Edward Fullbrook and Jamie Morgan
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Real-World Economics Review Blog 
The situation in the US is significantly worse than implied by the chart shown.
http://research.stlouisfed.org/fred2/graph/fredgraph.png?g=Av0
Above is a chart of average hourly earnings for the bottom 90% working class (production and non-supervisory workers) adjusted for the CPI, which shows real wages at the same level as 1968.
http://research.stlouisfed.org/fred2/graph/fredgraph.png?g=Av5
The chart above is the aggregate of wages and hours to CPI, which is likely back to the 1930s-50s (FRED data only go back to the 1960s).
http://research.stlouisfed.org/fred2/graph/fredgraph.png?g=Av2
http://research.stlouisfed.org/fred2/graph/fredgraph.png?g=Av4
The chart above alternatively shows working-class wages and aggregate of wages and hours to M2+, i.e., a loss of 72-76% of purchasing power of earned income to fiat digital debt-money inflation since 1973, which much more closely tracks the ACTUAL “cost of living”, including higher costs of financialized housing, energy, “education”, and “disease care” (of the sickest 5-10% who receive 50-65% of all spending) as a share of wages of the bottom 90%+.
Fiat digital debt-money inflation via fractional reserve banking and resulting deindustrialization, financialization, and feminization of the US economy and labor force has absolutely decimated the purchasing power of earned income of the American working class.
That the working class bottom 90% of Americans of all races, colors, creeds, and ideologies have not already risen up and burnt Wall St., the White House, and Capitol building to ashes is a testament to the extent to which mass-consumer and -media propaganda, debt to wages and GDP, and imperial bread and circuses have placated the masses and forestalled what historically has been the inevitable outcome of obscene wealth and income concentration to the rentier elite top 0.01-0.1%, oligarchic next 0.9%, and the professional middle-class next 9.9%.
But now debt to wages and GDP is not growing, i.e., can no longer grow, and the purchasing power of real after-tax wages and salaries less debt service and “disease care” are contracting at recession-like rates yoy for the bottom 90-95%. The US is becoming (has become) a Third World-like economy for the vast working class, but with 15-16 million new cars per year bought with subprime auto loans and requiring $3.50-$4.00/gal gasoline to operate.
Reblogged this on ..::popular spanish practices::.. and commented:
you should see those figures compared to countries like Spain or Greece..
This raises the obvious question that is the median weekly wage now more in the UK than in the US?
Because if the wages have been stagnating for so long in the US, at some point you would have to expect that median people in the europe would start to have better standard of living, even tought GDP per capita may be higher in the US.
It would be interesting to know, anyone have any stats?
I don’t have stats but I have an observation. I know an American couple of doctors (!) who moved to Germany to work in the pharma business, because they cannot afford the medical bill for their handicapped child in the US.