Thursday, December 22, 2022

Capitalist Wealth Grows


Examining the latest annual earnings data from the Social Security Administration, Elise Gould and Jori Kandra of the Economic Policy Institute (EPI) found that "the top 1% now amasses a record share of total earnings, while the bottom 90% share of earnings has hit a historic low...Wages for the top 1% grew more than seven times as fast as wages for the bottom 90% between 1979 and 2021,"

Earnings inequality in the United States has risen dramatically over the past four decades and continues to accelerate, with the top 0.1% seeing wage growth of 465% between 1979 and 2021 while the bottom 90% experienced just 29% growth during that same period.

The EPI experts noted that "the share of earnings at the very top—the top 0.1% of wage earners—is driving the rising earnings share of the top 1%."

"The share of the top 0.1% increased from 1.6% of total earnings in 1979 to a whopping 5.9% of total earnings in 2021, roughly 3.7 times as much," Gould and Kandra wrote. "Of the 7.3 percentage point rise in the share claimed by the top 1%, 4.3 percentage points (roughly 60%) can be explained by the rise of the top 0.1% share."

"The bottom 90% of wage earners experienced wage growth that lagged far behind average growth for much of the last 40-plus years," Gould and Kandra observed. "In 2021, average annual earnings of the bottom 90% were $36,571, while the top 5% earned, on average, $335,891, more than nine times as much as the bottom 90%."

In 2020 and 2021, the first two years of the coronavirus pandemic, the "only group to experience real wage gains... was the top 1% of the earnings distribution."

"While the bottom 90% experienced losses of 0.2%, those in the 90th-95th percentiles experienced larger losses of 2.0%," EPI found. "Between 2020 and 2021, earnings for the top 1% and top 0.1% rose 9.4% and 18.5%, respectively."

"With the possible exception of excess unemployment, declining union membership plays the single most significant role in slow and unequal wage growth," the pair wrote. "This erosion was not driven by workers' declining interest in unions, but rather by concerted employer opposition, along with state and federal policy that has made it nearly impossible for workers to form unions in the face of unwilling employers."

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