Workers deserve to share results of their productivity
Labor Day 2006 comes at a time when American working people are producing more for less.
Worker productivity rose 16.6 percent from 2000 to 2005, according to an analysis of Labor Department statistics by the Economic Policy Institute, a research group.
Total compensation for the median worker did not keep pace, rising 7.2 percent during the same period. Since 2003, the inflation-adjusted median hourly wage for American workers has declined 2 percent, according to The New York Times.
Meanwhile, corporate profits have climbed and the highest-paid people have done quite well, with the top 1 percent of earners receiving 11.2 percent of all wage income, up from 8.7 percent a decade earlier. Ben S. Bernanke, chairman of the Federal Reserve, warned recently that the unequal distribution of the economy's benefits could derail the liberalization in international trade that has taken place in recent decades.
In Alabama, the situation is similar. The Economic Policy Institute and the Arise Citizens' Policy Project issued a report Saturday on "The State of Working Alabama 2006." It says that the gap between wages for Alabama's lowest-paid and highest-paid workers increased 27 percent between 1979 and 2005. The median household income in Alabama declined 5 percent between 2000-01 and 2004-05, to $37,502. Alabama's 2005 child-poverty rate was 24.7 percent, better only than Mississippi's.
"Economic expansion isn't what it used to be," said Kimble Forrister, the Citizens' Policy Project's executive director. "When today's retirees were working, higher productivity meant bigger paychecks that rewarded those doing the work. Today, the rewards are staying at the top, while people down the line work longer hours, take extra jobs, or max out their credit cards to make ends meet."
One bright spot in the Alabama report is that the percentage of Alabama children under 18 who lack health insurance is less than half the national percentage — 5.3 percent in this state, 11.2 percent nationally. That's attributable to the Medicaid and ALL Kids programs.
Ron Gilbert, main author of the Alabama report, says this shows that public policy can make a difference for the most vulnerable people. Similarly, public policy — as well as enlightened corporate policy — can see that workers get the rewards they deserve for their rising productivity.