Fifty years ago Martin Luther King Jr. asked to wake up to a dream of an equal America. But he wasn’t asking for it merely on racial terms. As a quarter of a million protestors marched toward the steps of the nation’s Capitol a few days before Labor Day, the rallying cry didn’t start with “equality.” It began with “jobs.”
Ask a bull in the financial market how the economy’s going these days, four years after the recession officially ended in America, and you’ll likely catch them between sips of champagne. JP Morgan Chase and Co., who you may know for helping cause the destruction of the U.S. economy in 2007, reported a 53 percent quarterly jump in profits to start off the year compared to last.
But that wild run up the jagged mountain nicknamed Dow Jones, like an economic Everest, hasn’t been a trip for all of us. For some, that peak is the highest high they’ve even seen, cresting 15,600 in August. But most of us have been the sherpas to the few high-climbing millionaires who’ve ascended to the summit on our backs, left us behind, and tasked us with saving the lucky few if they fall off the mountain.
The march toward economic equality, on the 50th anniversary of the most iconic civil rights speech in American history, has taken far fewer steps upward than King dreamed.
Take a look at a median household income chart from economic research firm Sentier Research and you’ll see your first major symptom. In 2008, just as the world economy fell off a cliff, the median household income of Americans reached above the Consumer Price Index (CPI) for the final time. It hasn’t been back into the black since, with the most recent quarterly report showing consumer spending power at 7.2 percent below the CPI.
In layman’s terms, life has gotten more expensive, and the average American’s paycheck has lagged devastatingly behind, even as the economy has allegedly reached new heights.
And that’s not because we’re slower, lazier or less productive. Take a look at gross domestic product (GDP), a key measure of our total economic output as a country; it’s soared. In just the last three years the real GDP has leapt from 14 trillion to nearly 16 trillion – almost as rapidly as the U.S. GDP grew during the previous 10 years combined.
And we’ve done it under unfathomable pressure, as the economy shed jobs for 25 straight months before finally stabilizing in 2010. And as many have come to know in their own working lives, many of the jobs that remained were now carrying additional duties for the same pay to make up for laid off coworkers. Still, we became more productive, making more money per person. But that money almost exclusively stayed at the top of companies, rather than that growth trickling down into employees’ paychecks.
The evidence is clear in that regard, reflected in GDP and stock indexes, which have returned to record levels.
But take a look at employment and it’s as if the recession never left. The most recent quarter the Bureau of Labor Statistics (BLS) reported that only 47 percent of American adults older than age 16 who weren’t institutionalized had a full time job. That number was higher than 52 percent before the recession, and as high as 54 percent in 2000.
But unemployment overall has fallen in the last three years. So what’s the employment issue? A “part-time recovery,” which has added far fewer full-time jobs than part-time ones. The BLS estimates 8 million working Americans are working part time because they have to, not because they want to. College graduates, saddled with five or even six figures of debt, have found themselves increasingly faced with a job market that only wants them on a part time basis. And those hourly jobs are far more likely to pay at or near minimum wage.
A frequent point of contention made by business leaders to the argument for raising the minimum wage is that so few workers in America actually work for the federal minimum wage (some estimates ranging as low as 2.9 percent) that it wouldn’t make much difference to raise it. Try telling that to a worker making 10 cents more than that per hour, or a dollar more. Wal-Mart, America’s largest employer, touts that most of its workers don’t work for minimum wage. A recent CNN poll showed an average of less than $9.50 per hour. And with the gap between that pay and the proposed living wage standard of $13.10 per hour (proposed in the International Labor Review in 2006) has remained untenably massive for those stuck even within 180 percent of the federal minimum wage.
But it’s not just part-timers and low-wage workers suffering. Remember JP Morgan Chase? Their CEO Jamie Dimon made $18.7 million last year, a cut from $23 million in 2011. Based on a 40-hour week (which adherents to the idea that America is a financial meritocracy will have you believe is a serious underestimate of his working hours), Dimon’s wage plunged to only $8,990 per hour, causing him to be unable to buy a new Maserati Quattroporte per day of labor. But if you count only his salary and not associated compensation, he was only paid $721 per hour — far more than he made five years ago.
But apparently he’s not sweating his chances of having to go on public assistance anytime soon — not like the billions his company received in taxpayer-funded bailout funds during the recession. A financial disclosure form in the most recent quarter showed JP Morgan Chase paid $500,000 into the Fix the Debt Coalition, which pushes for cuts in Social Security and Medicare.
So as thousands more march on Washington this week in honor of King’s dream of a more equal America, keep in mind that their march isn’t just symbolic. It’s been a long journey for worker equality, and the climb is getting steeper to the top.