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Wages, Unions, and Two New BLS Reports


The Bureau of Labor Statistics came out with a couple of recent reports (here and here). I thought I would discuss a few of the items that struck me as interesting.

In the 4th quarter of 2010, the seasonally unadjusted median wage for full time wage and salary workers was $752/week. This was up from $748/week in the 4th quarter of 2009 or 0.5%. The bad news is that the Consumer Price Index for All Urban Consumers (CPI-U) which likely understates inflation was up 1.3% in 2010. So the working public actually fell a little further behind in 2010.

Another way I like to look at this is not in nominal dollars (the $752) but in constant dollars. The BLS uses 1982-1984 as the baseline and adjusts dollars according to the CPI. It's not perfect because of the problems in the calculation of the CPI but it gives you a way to compare year to year and see if American workers are making progress or falling behind.

So the weekly wage in 2010 in constant dollars was $342, down 0.9% from $345 in 2009. Data from the Current Population Survey (CPS). This is what we would expect when inflation outstrips wage growth.

The BLS data that I can access go back to 1979. In 1979, the weekly wage in constant dollars was $332/week. In other words, in 32 years, the median of American wages and salaries for full time workers has increased all of 2.9%. When we say that wages and salaries have been flat for 30 years this is what we mean.

Another number I found interesting, mentioned only in passing in the first report is that in 2010, there were only 100.12 million Americans who had full-time jobs for the whole year. Consider in December 2010 the work force was estimated at 153.69 million. This means that 53+ million Americans, in the work force (defined as both the employed and the U-3 unemployed) either were not full time or not full time for the whole year. That is a little more than 1/3 of the work force. To my eyes, that indicates a huge amount of instability and underutilization. By the way, full time is defined as working 50 or more weeks so 2 week vacations do not enter into this.

Another by the way is that the median for wages and salaries of part-time workers in the 4th quarter of 2010 was $226/week, and those are nominal (i.e. comparable to the $752/week).

A good reason why wages and salaries are so bad can be found in the second report on unions. In 2010, union membership was 11.9% of the work force minus the self-employed (14.7 million out of 124.073 million). This was down from 20.1% (17.7 million) in 1983 when the BLS began keeping these figures. Even more interesting is how this number splits out for 2010 between the public sector (36.2%) and the private sector (6.9%). Breaking down these numbers further. In 2010, union membership was 42.3% in local government (4.67 million: think teachers, police, and firefighters); 31.1% in state government (1.969 million); and 26.8% at the federal level (984,000). That is 7.623 million in the public sector vs. 7.092 million in the private sector. The majority of union members are in the public sector.

These numbers tell you both why unions are so weak and why the kleptocrats are so eager to take on the public component. In the private sector, unions have been rendered weak and irrelevant. Government is the only place where they exist with significant numbers and as a percent of the work force, and this is why they have become such a target.

So in brief, these reports pack a one-two punch. When unions were strong they were able to negotiate a bigger piece of the pie, not just for union members but for workers generally. With a decades long war against them and their current near demise, wages have gone nowhere. Instead the profits from productivity gains have been transferred almost entirely to an unproductive rentier class. Public worker unions are the last bastion, and now too they are under attack.

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Submitted by hipparchia on

there were only 100.12 million Americans who had full-time jobs for the whole year.

that's more than interesting, it's scary. does there exist somewhere a report [many reports?] with this number for other years?

and i could hve sworn that only recently the workforce was considered to be 160+ million, or am i misrtemembering?

Submitted by Hugh on

As I say in the post, the workforce in December 2010 was 153.69 million as reported by the BLS. The BLS undercounts this number, however. My estimate compensating for its undercount was 160.056 million for December.

I think we still have this 1950s view of the workforce, that except for a few part-timers and the unemployed, everyone was in a full-time year round job. I'm not sure of the components which account for the difference between the 100 million and the 153 or 160 million numbers, but no matter how you cut it, this workforce is very different from our traditional romanticized view of it.