By Svetlana KrilyukSPECIAL TO THE CHRONICLE
Though the U.S. economy has been making a comeback since the end of the recession in 2009, prospects for Americans about to graduate from college may be dim.
According to the Pew Research Center and Economic Policy Institute, middle class wages are the same now as they were in 1990, adjusted for inflation.
This is especially alarming because the structure of American society is very different now: less people marry, more people live alone and more people get a higher education, among other things. Furthermore, while wages have remained stagnant, the cost of living has risen with inflation. The $50,000 income that once supported a family of four with primarily one breadwinner in 1990 now supports one person.
A recent survey by the Pew Research Center has shown that more and more Americans are considering themselves a part of the lower middle class and lower class than ever before. Moreover, if Americans today are looking at a future of making the same amount as they did in 1990, that means we are not achieving the American dream: the idea that each generation does better than the prior.
According to the Pew Research Center, the number of jobs that require middle-skill, therefore being middle-income jobs, has not increased nearly as much as jobs that are low-skill and jobs that are high-skill. In essence, more and more college students are graduating to jobs that don’t require a degree.
This polarization of jobs may exist because technology has replaced many middle-skill jobs while creating a need for a disproportionate number of low-skill jobs.
If in 1970, 55 percemt of U.S. income was earned by the middle 60 percent, today it has fallen to 45 percent, consistent with the fact that middle class jobs are lost.
There are many speculations as to what can be causing this wage stagnation. The fact that we have a large population, the Baby Boomers, going into retirement, will be a factor that brings the median income down, but the truth is that this has been happening for a long time. Up until the year 2000, incomes rose, and then they stopped, so the Baby Boomers are not likely to be the cause. Others speculate that the inequality gap in America is the culprit.
Whether any of these reasons or something else is to blame, this issue is an important one to consider when choosing a candidate in the November election. Does your candidate discuss this problem? What is his or her plan to address it? After all, if our income does not grow over the next 15 years, we will graduate to lower paying jobs and have less money to spend, thus causing the economy to grow even slower.
Ultimately, there has been a downward trend in income, when there should have been a gradual growth. Between 1997 and 2007, there was little improvement, and today is not propitious, either. The median U.S. income is still 9 percent lower than it was in 1999, and we are out of a recession. Though the middle-class income should have been about $94,000 in 2007, it was actually only at $76,000.
We can continuously speculate about the reasons for the lack of growth in income, but the fact is that the average American graduate no longer feels secure.
What the future holds and how to fix our economy to ensure wages grow is an enigma in itself, but the importance of knowing these facts lies in the warning that they provide.
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