Earnings remain the same despite the rise in corporate profitsby RECEP KARACA Experienced Content Writer
Last year, in the days leading up to Labor Day, the country witnessed a slower growth rate in the employment sector, along with many economists opining the country would take more than six years (till 2021)to reinstate jobs which were never created or lost during the economic recession. But the economy of the country seems to be back on track and according to the current growth rate; jobs that were missing will witness superb recovery within the next four years.
Despite the country’s economy recovering at a steady pace with substantial increase in corporate profits, the job quality and number have not witnessed the same improvement as had people’s earnings. Last year, the after-tax corporate income that was tied to the economy’s share component was at a record level highest, and can be compared to that of 1965; the labor compensation, on the other hand, dropped to its lowest level since 1948! Most importantly, the overall wage growth has not been able to match the productivity growth since the year 1979, and has therefore resulted in flat or falling earnings for a good number of workers, while the coffers of executives, investors and individuals in top positions have seen a big boost.
At the same time, the recent improvement in the economy, even if it carried on, will not mean a remarkable improvement in the standard of living for a large number of the working class. This is because the skewness of the country’s economy is not the consequence of market factors but is due to the scarcity of policies that are needed to provide prosperity for all. To change this imbalance, proper and solid economic and labor reforms are needed. According to recent findings by the Economic Policy Institute, hourly wages for the first part of 2013 till the first part of 2014 were at an all-time low for every American citizen. According to the report, the only exception was seen in the bottom 10% level of workers whose minimum wage saw an increase.
For this reason, increasing the value of minimum wage at a Federal level is highly important and the increase of wages to $10.10 demanded by the US President along with the Democrats would lead to an extra $35 billion into the savings of wage earners. Likewise, stronger implementation of anti-trust and labor laws is necessary to guard people from wage theft. At present, President Obama has brought out executive orders for the improvement of working conditions and the payment of workforce under Federal contractors. In addition, overtime pay rules are being revised by the Labor Department, which could lead to millions of workers becoming eligible for overtime pay.
Formation of unions is another way forward towards the augmentation of benefits and pay for low-wage earners. Nevertheless, despite the many measures toward the improvement of the well-being of workers, the country still lacks a complete employment program that considers labor, and not big companies as the focal point of the country’s economy.
Created on Nov 28th 2022 10:45. Viewed 48 times.
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