As Americans take time off today in honor of Labor Day, it seems appropriate to examine the state of U.S. workers.
By some measures, these are good times. Unemployment is near historic lows; the stock market is booming; consumer confidence is high; and corporate profits are soaring. Some of that is due to a stimulus package that included tax cuts and spending increases that have fueled a ballooning deficit. The federal government’s deficit is expected to be near $1 trillion this year, and the national debt has topped $21 trillion.
Many Americans are not interested in the details; they’re just concerned about whether or not they have a job. The unemployment rate fell to 3.9 percent in July, a level considered “full employment,” and strong economic growth portends a prosperous future. While those accomplishments should not be ignored, there remains cause for concern. The strength of the United States depends upon the sturdiness of its workers, and there always is room for improvement.
Real wages for most workers remain stagnant, with the Labor Department reporting that inflation-adjusted hourly wages fell 0.2 percent in July from the previous year. Equally important is the public’s perception of those wages. “When you look at that backbone of the country — the middle class — people think that there’s stagnancy and not much has happened for them,” said Tim Malloy, a pollster at Quinnipiac University.
Meanwhile, a new study by the left-leaning Economic Policy Institute demonstrated the continuing income gap between Americans. CEOs for the 350 largest corporations earned an average of $18.9 million last year, an increase of 17 percent from the previous year; wages for the average worker grew 0.2 percent. CEOs last year earned 312 times more than the typical employee, meaning they were paid more for one day of work than the average employee made all year, assuming a five-day workweek.
According to the Economic Policy Institute — and other studies — in 1965, the average CEO made 20 times the average employee’s salary. That slowly increased through the 1970s and 1980s before ballooning in the 1990s. It has hovered around 300 times the rate of employee salaries ever since.
In other words, the issue predates the presidency of Donald Trump — or Barack Obama — and it has lingered through both Republican and Democratic administrations. While some might argue that CEOs earn their keep by being innovative and by having the skills to organize thousands of employees, it is impossible to ignore the damage such disparity is doing to the economy and to the nation. The United States would benefit from lawmakers who focus on policies that benefit the middle class, the typical worker, and the small business down the street that employs a half-dozen people and keeps its revenue in the community.
Such concern for the working class is what led to the creation of Labor Day. Promoted by growing trade unions and a burgeoning labor movement, the first Labor Day celebration took place in 1882 in New York City; in 1894, the holiday became federal law. Since then, it has acknowledged the role of unions in improving conditions for workers. The eight-hour workday, 40-hour workweek, workplace safety regulations, child labor laws and other benefits all can be traced to pressure mounted by labor unions.
That is the purpose of the holiday, recognizing that American workers deserve credit for building the most powerful economy in the world.
