Tag Archives: income

How much did wage inequality change in 2020?

The EPI article Wage inequality continued to increase in 2020 by Lawrence Mishel and Jori Kandra (12/13/2021) provides the graph copied here. As for the share of the overall pot:

This disparity in wage growth reflects a sharp long-term rise in the share of total wages earned by those at the very top: the top 1.0% earned 13.8% of all wages in 2020, up from 7.3% in 1979. That marks the second highest share of earnings for the top 1.0% since the earliest year, 1937, when data became available (matching the tech bubble share of 13.8% in 2000 and below the share of 14.1% in 2007). The share of wages for the bottom 90% fell from 69.8% in 1979 to just 60.2% in 2020.

The article also has two tables of data that could be useful in stats or QL course.

How did COVID impact K-12 learning based in income?

The Pew article What we know about online learning and homework gap amid the pandemic by Katherine Schaeffer (10/1/2021) has this to say:

Parents with lower incomes whose children’s schools closed amid COVID-19 were more likely to say their children faced technology-related obstacles while learning from home. Nearly half of these parents (46%) said their child faced at least one of the three obstacles to learning asked about in the survey, compared with 31% of parents with midrange incomes and 18% of parents with higher incomes.

This technology divide isn’t new:

Even before the pandemic, Black teens and those living in lower-income households were more likely than other groups to report trouble completing homework assignments because they did not have reliable technology access. Nearly one-in-five teens ages 13 to 17 (17%) said they are often or sometimes unable to complete homework assignments because they do not have reliable access to a computer or internet connection, a 2018 Center survey of U.S. teens found.

There are four other charts in the article.

How did CEOs do during the pandemic?

Did CEOs take a pay hit like many workers did during the pandemic? The article CEO pay has skyrocketed 1,322% since 1978 by Lawrence Mishel and Jori Kandra (8/10/2021) suggests CEOs did just fine last year. Their chart shows that realized CEO compensation grew during 2020 compared to the average worker.

Details on the metric:

We focus on the average compensation of CEOs at the 350 largest publicly owned U.S. firms (i.e., firms that sell stock on the open market) by revenue. Our source of data is the S&P ExecuComp database for the years 1992 to 2020 and survey data published by the Wall Street Journal for selected years back to 1965. We maintain the sample size of 350 firms each year when using the ExecuComp data.

The realized measure of compensation includes the value of stock options as realized (i.e., exercised), capturing the change from when the options were granted to when the CEO invokes the options, usually after the stock price has risen and the options values have increased. The realized compensation measure also values stock awards at their value when vested (usually three years after being granted), capturing any change in the stock price as well as additional stock awards provided as part of a performance award.

The granted measure of compensation values stock options and restricted stock awards by their “fair value” when granted (Compustat estimates of the fair value of options and stock awards as granted determined using the Black Scholes model).

Well maybe CEO pay just went down less than worker pay and that is why the ratio went up. In table 1, realized pay for 2019 is $20,351,000 with 2020 projected as $24,194,00. There are other graphs in the article and data available for download.

What is the distribution of global income?

The Our World in Data article How much economic growth is necessary to reduce global poverty by Max Roser (2/15/2021) includes the graph copied here. Note that all countries incomes are adjusted for price differences so it is fair comparison from county to country. It is easy to forget how much wealthier the U.S. is compared to almost all other countries.

The reason why such substantial economic growth is necessary for reducing global poverty is that the average income in many countries in the world is very low: 82% of the world population live in countries where the mean income is less than $20 per day.

There are three other graphs in the article, which is suitable for a QL based course. There isn’t data associated with these particular graphs but there are links at the top of the article with related economic data.

Why did wages grow in 2020?

The EPI article, Wages grew in 2020 because the bottom fell out of the low-wage labor market, by Elise Gould and Jori Kandra (2/24/2021) provides insights into changes in the labor market this past year. Key find:

Wages grew largely because more than 80% of the 9.6 million net jobs lost in 2020 were jobs held by wage earners in the bottom 25% of the wage distribution. The exit of 7.9 million low-wage workers from the workforce, coupled with the addition of 1.5 million jobs in the top half of the wage distribution, skewed average wages upward.

There are seven graphs or tables in the article with the associated data. The last two graphs are of the same type as the one copied here but for the 2000 and 2008 recessions, respectively.

Is this chart misleading?

The U.S. Bureau of Labor Statistics posts the chart (partially) copied here and last updated Sept 2020. An initial look at the graph and we see that the top 5 each have a median pay higher than the median pay in the U.S. (about $35k), but this is based on growth rate. On the other hand, if we look at the number of jobs the top 5 here are predicted to create, Table 1.3 from the BLS, we get 152.2 thousand jobs.  The sixth job on this list, home health and personal care aides, has a below median pay but is predicted to create 1,159.5 thousand jobs. There are 30 jobs listed in table 1.3 and home health and personal care aides represents about 45% of predicted new jobs created on this table. One can download the data in table 1.3 in an xlsx file.

How are the top 0.1% doing?

The EPI article Wages for the top1% skyrocketed 160% since 1979 while the share of wages for the bottom 90% shrunk by Lawrence Mishel and Jori Kandra (12/1/2020) reports:

As Figure A shows, the top 1.0% of earners are now paid 160.3% more than they were in 1979. Even more impressive is that those in the top 0.1% had more than double that wage growth, up 345.2% since 1979 (Table 1). In contrast, wages for the bottom 90% grew only 26.0% in that time.

The top 0.1% go off the chart. There are two other tables of data nd the data for the chart copied here is available.

Who earned the most in the 3rd quarter of 2020?

The U.S. Bureau of Labor Statistics has a Graphics for Economic News Releases page. The graph copied here is median usual weekly earnings of full-time wage and salary workers. Most of the patters are not a surprise, such as men earning more than women.  What may be new here is that Asian women ($1224) out earned White men ($1122). Asian men out earned all others at $1542. The page includes seven other charts with the data.

What is median household income by race and ethnicity?

The EPI article Racial disparities in income and poverty remain largely unchanged amid strong income growth in 2019 by Valerie Wilson (9/16/2020) reports the data from the Census Bureau on income and poverty in the graph copied here.

…real median household income increased 10.6% among Asian households (from $88,774 to $98,174), 8.5% among Black households (from $42,447 to $46,073), 7.1% among Hispanic households (from $52,382 to $56,113), and 5.7% among non-Hispanic white households (from $71,922 to $76,057), …

There is a second graph on poverty rates and data is included for both graphs, as well as a link to the original Census Bureau data.

Is the racial wealth gap evenly distributed by class?

The article The Racial Wealth Gap is About the Upper Classes by Matt Bruenig (6/29/2020) on the People’s Policy Project explains. First the racial wealth gap is large:

If you take the net worth of all white households and divide it by the number of white households, you get $900,600. If you do the same thing for black households, you get $140,000. The difference between these figures — $770,600 — is the best representation of the overall racial wealth gap.

The graphs here from the article show that the wealth in both groups is largely concentrated in the top 10%.

What this means is that the overall racial wealth disparity is being driven almost entirely by the disparity between the wealthiest 10 percent of white people and the wealthiest 10 percent of black people.

Overall,

This means that even after you have completely closed the racial wealth gap between the bottom 90 percent of each race, 77.5 percent of the overall racial wealth gap still remains, which is to say that the disparity between the top deciles in each race drives over three-fourths of the racial wealth gap.

Further,

What this shows is that 97 percent of the overall racial wealth gap is driven by households above the median of each racial group.