The gap between what the rich and poor earn has been growing nationwide for four decades. The lowest 10 percent of wage earners nationwide were making no more than $7.70 an hour in 1973. That grew by just 4.5 percent, to $8.05, by 2009, according to the Economic Policy Institute, a D.C.-based think tank that focuses on the economic condition of low-and middle-income Americans.
Meanwhile, at the other end of the economic spectrum, the top 5 percent of earners made at least $35.37 an hour in 1973 compared with $48.08 in 2009 — an increase of 36 percent.
The numbers don’t include earnings from stocks or dividends that can increase total income — factors more likely to benefit the wealthy, further increasing the gap.
“This is a trend that’s been going on nationally for a long time,” said Elizabeth McNichol with the Center on Budget and Policy Priorities. “Until unemployment comes down … we’re going to see this pattern.”
While productivity grew by 80 percent between 1979 and 2009, the hourly wage for the median worker grew by 10 percent — and all of that growth occurred between 1996 and 2002, according to the EPI.
Michael Cassidy, president of the Commonwealth Institute for Fiscal Analysis, a Richmond-based think tank that focuses particularly on economic issues affecting low- and moderate-income people, said that such a trend played a part in the economic crisis that began in 2007.
“If folks aren’t getting increased wages … and we are providing them with looser credit and they are going into increased indebtedness to make ends meet, you see a lot of the root of many of the misplaced financial instruments people are using that impact the economy,” he said.
