February, 19 2019, 11:00pm EDT
Wage Inequality Continued in 2018
Disparities by race and gender persist
WASHINGTON
Inflation-adjusted wages grew for most workers across the wage distribution in 2018, according to a new report by EPI Senior Economist Elise Gould. Analyzing data from the Current Population Survey (CPS), Gould finds that while some workers saw modest wage growth last year, large gaps by gender, race, wage, and education level remain--and some of these gaps are increasing.
The State of Working America: Wages 2018 details the most up-to-date hourly wage trends through 2018, showing that, while there have been welcome improvements, wage growth continues to be slower than would be expected in an economy with relatively low unemployment.
"Since 2000, wage growth has been strongest for the highest-wage workers, continuing the trend in rising wage inequality for the past four decades," said Gould. "Additionally, many working people, particularly working women and black workers are still facing persistent and, in some cases, worsening wage gaps."
Other key findings in The State of Working America: Wages 2018, an annual look at wage trends as part of EPI's State of Working America series, include:
- From 2017 to 2018, relatively fast wage growth continued at the top, but workers at the 20th and 30th percentiles saw the strongest wage growth. Median wages grew 1.6 percent over the year.
- State-level minimum wage increases over the last few years are associated with stronger wage growth for low-wage workers in those states.
- Significant gender wage gaps remain across the wage distribution and by educational attainment. Men with only a college degree are paid more on average than women with advanced degrees.
- Wage growth since 2000 was faster for white and Hispanic workers than black workers. Black-white wage gaps were larger in 2018 than in 2000. Among black workers, only college- and advanced-degree holders had higher wages than in 2000, but their wage growth was significantly slower than white and Hispanic workers with those same degrees.
- Over the last year, the strongest wage growth occurred among those with some college and those with advanced degrees. Between 2000 and 2018, the college wage premium rose slightly, not nearly fast enough to explain rising wage inequality.
"Low wage workers in the 21 states (and the District of Columbia) that increased their minimum wage in 2018 experienced stronger wage growth than low-wage workers in the states that didn't," said Gould. "Simply put, policy matters."
Notably, while the CPS is one of the best measures of hourly pay, the CPS "top-codes" weekly earnings above $2,884.61 as having weekly earnings of exactly $2,884.61 in order to preserve the anonymity of respondents. Because this amount hasn't changed or been updated for inflation in 20 years, it has become harder to uncover wage levels at the top of the wage distribution and the extent of top-end wage growth.
EPI is an independent, nonprofit think tank that researches the impact of economic trends and policies on working people in the United States. EPI's research helps policymakers, opinion leaders, advocates, journalists, and the public understand the bread-and-butter issues affecting ordinary Americans.
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Despite 100% Pentagon Audit Failure Rate, House Passes $883.7 Billion NDAA
"Instead of fighting the rising cost of healthcare, gas, or groceries, this Congress prioritized rewarding the wealthy and well-connected military-industrial complex," said Defense Spending Reduction Caucus co-chairs.
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Despite the Pentagon's repeated failures to pass audits and various alarming policies, 81 Democrats in the U.S. House of Representatives voted with 200 Republicans on Wednesday to advance a $883.7 billion annual defense package.
The Servicemember Quality of Life Improvement and National Defense Authorization Act (NDAA) for Fiscal Year 2025, unveiled by congressional negotiators this past Saturday, still needs approval from the Senate, which is expected to vote next week. U.S. Sen. Bernie Sanders (I-Vt.) said Wednesday that he plans to vote no and spoke out against the military-industrial complex.
The push to pass the NDAA comes as this congressional session winds down and after the U.S. Department of Defense (DOD) announced last month that it had failed yet another audit—which several lawmakers highlighted after the Wednesday vote.
Reps. Mark Pocan (D-Wis.) and Barbara Lee (D-Calif.), co-chairs and co-founders of the Defense Spending Reduction Caucus, said in a joint statement, "Time and time again, Congress seems to be able to find the funds necessary to line the pockets of defense contractors while neglecting the problems everyday Americans face here at home."
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Several of the 124 House Democrats who voted against the NDAA cited those "culture war" policies, in addition to concerns about how the Pentagon spends massive amounts of money that could go toward improving lives across the country.
"Once again, Congress has passed a massive military authorization bill that prioritizes endless military spending over the critical needs of American families. This year's NDAA designates $900 billion for military spending," said Rep. Ilhan Omar (D-Minn.), noting the audit failures. "While I recognize the long-overdue 14.5% raise for our lowest-ranking enlisted personnel is important, this bill remains flawed. The bloated military budget continues to take away crucial funding from programs that could help millions of Americans struggling to make ends meet."
Taking aim at the GOP's push to deny gender-affirming care through TRICARE, the congresswoman said that "I cannot support a bill that continues unnecessary military spending while also attacking the rights and healthcare of transgender youth, and for that reason, I voted NO."
As Omar, a leading critic of the U.S.-backed Israeli assault on the Gaza Strip, also pointed out: "The NDAA includes a provision that blocks the Pentagon from using data on casualties and deaths from the Gaza Ministry of Health or any sources relying on those statistics. This is an alarming erasure of the suffering of the Palestinian people, ignoring the human toll of ongoing violence."
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Congresswoman Delia Ramirez (D-Ill.), who voted against the NDAA, directed attention to U.S. President-elect Donald Trump's proposed Department of Government Efficiency (DOGE), set to be run by billionaires Elon Musk and Vivek Ramaswamy.
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Rep. Ro Khanna (D-Calif.), who also opposed the NDAA, wrote in a Tuesday opinion piece for MSNBC that he looks forward to working with DOGE "to reduce waste and fraud at the Pentagon, while strongly opposing any cuts to programs likeSocial Security, Medicare, the Department of Veterans Affairs, or the Consumer Financial Protection Bureau."
"We should make defense contracting more competitive, helping small and medium-sized businesses to compete for Defense Department projects," Khanna argued. "The Defense Department also needs better acquisition oversight. Defense contractors have gotten away with overcharging the Pentagon and ripping off taxpayers for too long."
"Another area where we can work with DOGE is reducing the billions being spent to maintain excess military property and facilities domestically and abroad," he suggested. "Finally, DOGE can also cut the Nuclear-Armed Sea-Launched Cruise Missile program."
The congressman, who is expected to run for president in 2028, concluded that "American taxpayers want and deserve the best return on their investment. Let's put politics aside and work with DOGE to reduce wasteful defense spending. And let's invest instead in domestic manufacturing, good-paying jobs, and a modern national security strategy."
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