Today, the Wall Street Journal reports the sobering news that, since 2000, real wages have fallen for every educational group in America except folks with professional degrees (doctors, lawyers, and the like). All other groups, even those with master's degrees and Ph.D.'s, saw declining wages over this period. The WSJ piece is based on recently released Census data (you can find the most recent Census Bureau report on income and earnings here).
In recent years, the college earnings premium has decreased substantially. As the Journal points out:In 1975, for instance, workers with college degrees earned 60% more per year on average than workers with high-school diplomas only, according to the 2006 Economic Report of the President.
Workers with a college degree saw their earnings premium grow steadily over the next quarter century, and by 2000 their average earnings were roughly double what workers with a high-school diploma made. Over the next four years the trend reversed: By 2004, workers with a college diploma only were earning about 80% more than high-school grads, on average.
The Journal article identifies globalization (including the outsourcing of both blue- and white-collar jobs) and rising health costs as possible causes for the decline in wages. One reason workers' wages aren't keeping up with inflation is that health care costs have risen dramatically in recent years, so employers are shelling out more for health coverage, and less in wages.
For most Americans, these data paint a fairly bleak picture of their economic prospects. About the only good thing I can say about this is that, given this economic climate, I find it almost impossible to believe that the Republicans triumph this November. The seven-year period during which wages have been in freefall just happen to be seven years in which a Republican was president and Republicans, for the most part, controlled Congress. There's no way in hell that the Republicans should be able to get away with this. If, in spite of everything, they end up winning this fall, it will be the con job of the century.
