Category Archives: Income Inequality/Gap

Report of the Special Rapporteur on extreme poverty and human rights on his mission to the United States of America

Source: United Nations, General Assembly, Human Rights Council, Thirty-eighth session, Agenda item 3, June 18 – July 6, 2018

From the Oral Statement by Mr. Philip Alston Special Rapporteur on extreme poverty and human rights, 38th session of the Human Rights Council:
…. My starting point is that the combination of extreme inequality and extreme poverty generally create ideal conditions for small elites to trample on the human rights of minorities, and sometimes even of majorities. The United States has the highest income inequality in the Western world, and this can only be made worse by the massive new tax cuts overwhelmingly benefiting the wealthy. At the other end of the spectrum, 40 million Americans live in poverty and 18.5 million of those live in extreme poverty. In addition, vast numbers of middle class Americans are perched on the edge, with 40% of the adult population saying they would be unable to cover an unexpected $400 expense.

In response, the Trump administration has pursued a welfare policy that consists primarily of (i) steadily diminishing the number of Americans with health insurance (‘Obamacare’); (ii) stigmatizing those receiving government benefits by arguing that most of them could and should work, despite evidence to the contrary; and (iii) adding ever more restrictive conditions to social safety net protections such as food stamps, Medicaid, housing subsidies, and cash transfers, each of which will push millions off existing benefits. For example, a Farm Bill approved yesterday by Republicans in the House of Representatives would impose stricter work requirements on up to 7 million food stamp recipients. Presumably this would also affect the tens of thousands of serving military personnel whose families need to depend on food stamps, and the 1.5 million low-income veterans who receive them. ….

Organized Labor’s Check on Rising Economic Inequality in the U.S. States

Source: Laura C. Bucci, State Politics & Policy Quarterly, Volume 18 Issue 2, June 2018
(subscription required)

From the abstract:
Recent demonstrations of growing economic inequality in the United States raise normative concerns about the political representation of all but the very wealthiest citizens. Building on existing cross-national work on the roles of unions in welfare states, I provide evidence that organized labor, as a political institution, limits unequal income distributions in the U.S. states. The states are useful to our understanding of labor’s influence on inequality as states differ in their acceptance of labor unions, base levels of inequality, political preferences, industries, and levels of development but are all nested within a single overarching national framework. Over the 39-year period examined, states where unions maintain more members remain more equal within the labor market and after redistribution via government transfer. These effects persist after accounting for state-level policy, demography, and economic conditions. However, states where union membership has the largest influence on inequality have also seen growing attempts to reduce unionization rates. Overall, I find that unions are still able to limit the growth of economic inequality in spite of declining levels of union membership.

Do We Need a Universal Basic Income? A Debate.

Source: Matt Bruenig, rebuttal by Rohan Grey and Raúl Carrillo, In These Times, June 2018

Getting free money from the government is popular. But would it prop up capitalism?

Related:

Do We Need a Federal Jobs Guarantee? A Debate.
Source: Rohan Grey and Raúl Carrillo, rebuttal by Matt Bruenig, In These Times, June 2018

Sens. Kirsten Gillibrand, Cory Booker and Bernie Sanders have all proposed a job guarantee. But would it be drudgery?

Race, Economics, and Social Status

Source: Reginald A. Noël, Bureau of Labor Statistics, Spotlight on Statistics, May 2018

Social and economic status of an individual or group can be measured as a blend of wealth, income, occupation, and education. Other contributors to social and economic status include race, ethnicity, home ownership, family size, family types, and even types of foods purchased. The combination of social and economic status can reveal a group or individual’s unequal access to resources, privilege, power, and control in a society. This Spotlight on Statistics examines Consumer Expenditure Survey data to explore the patterns of social and economic factors by race and ethnicity.

Workers’ wages fall after passage of GOP tax cuts

Source: Ryan Koronowski, ThinkProgress, June 13, 2018

Trump’s corporate tax cut hasn’t benefited workers like he said it would.

Related:
Real Earnings Summary – May 2018
Source: Bureau of Labor Statistics, Economic News Release, USDL-18-0996, June 12, 2018

All employees
Real average hourly earnings for all employees increased 0.1 percent from April to May, seasonally adjusted, the U.S. Bureau of Labor Statistics reported today. This result stems from a 0.3-percent increase in average hourly earnings being offset by a 0.2-percent increase in the Consumer Price Index for All Urban Consumers (CPI-U).

Real average weekly earnings increased 0.1 percent over the month due to the increase in real average hourly earnings combined with the unchanged average workweek.

Real average hourly earnings were unchanged, seasonally adjusted, from May 2017 to May 2018. Combined with a 0.3-percent increase in the average workweek, real average weekly earnings increased by 0.3 percent over this period. ….

…. Production and nonsupervisory employees

…. From May 2017 to May 2018, real average hourly earnings decreased 0.1 percent, seasonally adjusted…..

Raise Anatomy: How to Ask for a Raise and Get It

Source: PayScale, Inc., June 2018

From the press release:
Today, PayScale, Inc., the world’s leading provider of precise, on-demand compensation data and software, released new research showing which employees are asking for pay raises and which employees are receiving them. This study is designed to educate both employees and employers about biases which may impact pay decisions in an effort to achieve equitable pay raises regardless of race or gender. One of the key findings from the “Raise Anatomy” report is that white men are far more likely to actually get a raise when they ask for it than a person of color. ….

Key findings from the report:
• The majority of employees (70 percent) who asked for a raise received at least some pay increase.
• Of those who asked for a raise, 39 percent of employees got the amount they requested, while 31 percent received a smaller raise than requested.
• People of color were significantly less likely than white men to have received a raise when they asked for one. Women of color were 19 percent less likely to have received a raise than a white man and men of color were 25 percent less likely. (Note: No single gender or racial/ethnic group was more likely to have asked for a raise than any other group.)
• The most common justification for denying a raise was budgetary constraints (49 percent). Only 22 percent of employees who heard this rationale actually believed it.
• One third of workers report that no rationale was provided when they were denied a raise.
• When workers don’t believe the rationale, or aren’t provided one, they reported lower rates of satisfaction with their employer and reported being more likely to quit.
• Of those who said that they did not ask for a raise, 30 percent reported their reason for not asking was they received a raise before they felt the need to ask their manager.
• Employees who are most satisfied with their work and their employers are those who agreed with the statement: “I’ve always been happy with my salary.” ….

Related:
How to boost your odds of getting a raise: Ask for one, and be a white man
Source: Rachel Siegel, Washington Post, June 6, 2018

Mothers Lose $16,000 Annually to the Wage Gap, NWLC Analysis Shows

Source: National Women’s Law Center (NWLC), May 23, 2018

From the press release:
While women in the U.S. who work full time, year round are typically paid just 80 cents for every dollar paid to their male counterparts, the wage gap between working mothers and fathers is even larger. Mothers typically are paid only 71 cents for every dollar paid to fathers, which translates to a loss of $16,000 annually, according to new National Women’s Law Center (NWLC) analysis of Census data. The motherhood wage gap exists in every state and can mean mothers lose thousands of dollars more than the national figure: mothers do best in Maine, where they are paid 85 cents for every dollar paid to fathers, and worst in Utah, where they are paid only 58 cents for every dollar paid to fathers. ….

Key findings of the analysis include:
– More than 2 in 5 mothers (42.2 percent) are employed in one of twelve occupations, and in every one of those occupations, mothers are paid between 52 cents and 85 cents for every dollar paid to fathers.
– The wage gap exists for mothers at every education level.
– Among full-time, year-round workers, mothers with a high school degree make just 68 cents for every dollar paid to fathers with a high school degree.
– Fathers who earn a master’s degree or a doctoral degree are typically paid $100,000 and $115,000 respectively. Conversely, mothers who complete these degrees are typically paid no more than $90,000 annually.
– Asian/Pacific Islander mothers are paid 85 cents for every dollar paid to white, non-Hispanic fathers; white, non-Hispanic mothers are paid 69 cents; Black mothers, 54 cents; Native mothers, 49 cents; and Latina mothers, 46 cents. The wage gap persists for mothers of all ages

5 wage gap myths about women at work

Source: Amy McCaig, Futurity, May 31, 2018

Blame for the gender wage gap in the United States shouldn’t fall on women, report researchers.

In a review paper, they draw on existing psychological research to highlight myths regarding the gap between men and women and to offer possible explanations for why it exists. ….

5 myths about the gender wage gap:
Myth 1: Women aren’t doing equal work. ….
Myth 2: Women leave the workplace to have and raise children. ….
Myth 3: Women choose less lucrative professions. ….
Myth 4: Women don’t ask for what they want. ….
Myth 5: Women don’t have as much education or experience as men. ….

6 ways organizations can eliminate the wage gap:
1. Identify and remove barriers. ….
2. Provide equal growth opportunities. ….
3. Take action toward implementing better work/life balance. ….
4. Provide ongoing training. ….
5. Have anti-discrimination policies. ….
6. Have and promote male allies. ….

Related:
Victim Precipitation and the Wage Gap
Source: Shannon Cheng, Abigail Corrington, Mikki Hebl, Linnea Ng, Volume 11, Issue 1 March 2018
(subscription required)

In response to: Beyond Blaming the Victim: Toward a More Progressive Understanding of Workplace Mistreatment
From the abstract:
Cortina, Rabelo, and Holland (2018) accurately cite the general public’s overuse of victim precipitation ideologies, or the notion that victims engage in actions that directly bring about their unfortunate circumstances. These ideologies also have permeated industrial and organizational (I-O) psychology and the study of people in the workplace (e.g., women’s choice in clothing leads to sexual harassment, certain target characteristics and actions incite workplace bullying). We agree with Cortina et al. that this ideology unintentionally benefits the perpetrator by placing blame and responsibility for nonoptimal workplace situations directly on the target. The field of I-O psychology needs to move away from this model of victim blaming as a remediation for workplace disparities.