5 ms·

That's super interesting, I didn't know that about hourly wages. I tend to think of income gaining from 1950 to 1990 and flattening from the mid 1990s to now.

by joshe 8y ago

That's super interesting, I didn't know that about hourly wages. I tend to think of income gaining from 1950 to 1990 and flattening from the mid 1990s to now. Though it does look like total compensation (adding in benefits) did actually increase recently, they don't have anything for back to 1960. So maybe the story is that wages stayed flat, but benefits accounted for most of the income increase. Not an economist so I don't know how to tease this out. Heath care does go up from 5% of gdp in 1960 to 18.2% today, maybe most compensation gain is going there? Plus retirement benefits. But... from 1960 to 2000 the civilian labor force increased from 70 million to 141 million [1]. With all those new workers, by your link, compensation didn't actually shrink. That's weird huh? Also real median family income grew from $41K to $72K [2]. And sure 10 million software engineers added to SV tomorrow would lower wages. But maybe not long term? If it was 10 million countrywide? What would an economist or a careful wage survey say? Anyway we're talking about 85,000 jobs all over the country. The main point of my comment is that when economists spend 10 years looking at data and arguing out every detail, they conclude that immigration is increasing jobs and increasing wages. They usually conclude that for specific wage markets too. Maybe we can't rely on some anecdotes in the media to refute their conclusions? [1] https://www.bls.gov/opub/mlr/2002/05/art2full.pdf https://www.bls.gov/opub/mlr/2002/05/art2full.pdf (table 5) [2] https://fred.stlouisfed.org/series/MEFAINUSA672N https://fred.stlouisfed.org/series/MEFAINUSA672N

servercobra 8y ago
I generally agree with what you say, but the median family income growing seems like it would be due to most households moving from one to two workers. Looking at it that way, it makes wages look even flatter over the time period.
- abakker 8y ago
  Yes, this is right. Large increases in the workforce have increased the supply, reducing real wage growth, household earning has grown by adding a second earner. More work is getting done to get the same economic outcome. Put one way, this is terrible for wage earners, out another it is excellent for spenders since the thing you can buy have gotten cheaper through plentiful labor.
- roselan 8y ago
  With children staying with their parents into adulthood and earning a wage, we might even speak of 3 wages per household. This might be compensated my the raise of monoparental households.
TylerE 8y ago
The population grew from 179M to 281M so the workforce didn’t really double. More like a 50% increase
- joshe 8y ago
  The workforce grew, look at the link and table 5. Basically woman and minorities joined the workforce. Worker to population ratio went up and the total number of workers went up faster than the growth in population.
  - AlexTWithBeard 8y ago
    Correct me if I'm wrong, but I'd say pretty much all the minorities have always been a part of the workforce.
    - FiveSquared 8y ago
      Jim Crow laws, blackballing, and redlining. You ant allowed to work in certain jobs, if you speak out (see Kapernick), no job for you! And you can’t even live within reasonable distance of work!
    - joshe 8y ago
      Women were most of the increase, but minorities increased their participation too. You can see the tail end (looks like they didn't survey it until 1980) of it here: https://www.bls.gov/opub/mlr/2002/05/art2full.pdf https://www.bls.gov/opub/mlr/2002/05/art2full.pdf Table 4, look at Black participation rates from 1990 to 2015. For intuition think of extended families living together, being incarcerated, and being the last hired and the first fired (so out of work longer).
      - AlexTWithBeard 8y ago
        Thank you. Exactly the answer I was looking for!
hnaccy 8y ago
>Wage trends over the past half-century suggest that a 10 percent increase in the number of workers with a particular set of skills probably lowers the wage of that group by at least 3 percent. Even after the economy has fully adjusted, those skill groups that received the most immigrants will still offer lower pay relative to those that received fewer immigrants. >Immigration redistributes wealth from those who compete with immigrants to those who use immigrants—from the employee to the employer. And the additional profits are so large that the economic pie accruing to all natives actually grows... But behind that calculation is a much larger shift from one group of Americans to another: The total wealth redistribution from the native losers to the native winners is enormous, roughly a half-trillion dollars a year. Immigrants, too, gain substantially; their total earnings far exceed what their income would have been had they not migrated. https://www.politico.com/magazine/story/2016/09/trump-clinton-immigration-economy-unemployment-jobs-214216 https://www.politico.com/magazine/story/2016/09/trump-clinto... Unless you're an immigrant or high up in tech business why would you cheer more high-skill immigrants? It will depress your wages and the economic gains will not accrue to you.
- ben_w 8y ago
  Either the work is done in your country, where you: * control minimum wage laws etc., * collect the taxes, * benefit from most of the money being spent locally, or it’s done abroad, where a foreign government collects all the benefits. Import duties don’t do much to fix that. And if you have most or all of the workforce, then you get to lobby against other nations’ import duties.
  - arcseco 8y ago
    You don't really get to control min-wage laws, working standards or environmental regulations over the long term in a tariff free world. US trade deficits are growing and will inevitably have to be normalized. When that happens the US will have to become a lot more competitive with nations that don't have these standards in place. Stagnated wages are just the beginning and are borrowing time before labour standards and environmental standards are forced to equalize with the East.
pauljurczak 8y ago
> The main point of my comment is that when economists spend 10 years looking at data and arguing out every detail, they conclude that immigration is increasing jobs and increasing wages. Economists look at the past and extrapolate into future, often with really poor results. With increasing amount of automation, software development is probably safe from paradigm change for a short while. Given that, it is always risky to claim that immigration will increase jobs and wages in the next decade, because it did so in the previous one.
irrational 8y ago
So, it went from one person making $41K to two people making $72K ($36k each)? That doesn't seem like a growth situation.
- joshe 8y ago
  Not quite. From 1974 (they don't have data before that) to 2000, real mean personal income goes from 32K to 43K. [1], that's for individuals. The graph is useful to look at. This is complex, for example there are also more single parent / single person households which tends to lower household incomes. [1] https://fred.stlouisfed.org/series/MAPAINUSA672N https://fred.stlouisfed.org/series/MAPAINUSA672N
joshe 8y ago
I did find personal income growth from 1974 on. That gets rid of the 2 income household problem. I think maybe they only surveyed households til 1974. From 1974 to 2000, real mean personal income goes from 32K to 43K. [1]. The graph is useful to look at. I do think some of the story is that most compensation gains went to benefits, especially our crazy expensive health care (again 5% to 18.2% of gdp). So the hourly wages stayed the same, but benefits went up. I think the original point, that more workers did not lower income, still holds. Really I can't do an Econ Phd to respond to this thread. So I'll outsource to economists, who say more workers do not lower income. [1] https://fred.stlouisfed.org/series/MAPAINUSA672N https://fred.stlouisfed.org/series/MAPAINUSA672N
bradleyjg 8y ago
Your third paragraph is it. This is mostly an out of control health care cost growth story. Three areas of cost growth--health care, education, and housing costs--have now eaten the gains of two entire generation of Americans and none of the three look set to stop their cancerous growth rates any time soon. Way back in the ACA debates, when people talked about bending the cost curve, many people's eyes may have glazed over but that's exactly what we need to figure out a way to do. Not have a debate over immigration.

by joshe 8y ago

servercobra 8y ago

I generally agree with what you say, but the median family income growing seems like it would be due to most households moving from one to two workers. Looking at it that way, it makes wages look even flatter over the time period.

abakker 8y ago
Yes, this is right. Large increases in the workforce have increased the supply, reducing real wage growth, household earning has grown by adding a second earner. More work is getting done to get the same economic outcome. Put one way, this is terrible for wage earners, out another it is excellent for spenders since the thing you can buy have gotten cheaper through plentiful labor.
roselan 8y ago
With children staying with their parents into adulthood and earning a wage, we might even speak of 3 wages per household. This might be compensated my the raise of monoparental households.

TylerE 8y ago

The population grew from 179M to 281M so the workforce didn’t really double. More like a 50% increase

joshe 8y ago
The workforce grew, look at the link and table 5. Basically woman and minorities joined the workforce. Worker to population ratio went up and the total number of workers went up faster than the growth in population.
- AlexTWithBeard 8y ago
  Correct me if I'm wrong, but I'd say pretty much all the minorities have always been a part of the workforce.
  - FiveSquared 8y ago
    Jim Crow laws, blackballing, and redlining. You ant allowed to work in certain jobs, if you speak out (see Kapernick), no job for you! And you can’t even live within reasonable distance of work!
  - joshe 8y ago
    Women were most of the increase, but minorities increased their participation too. You can see the tail end (looks like they didn't survey it until 1980) of it here: https://www.bls.gov/opub/mlr/2002/05/art2full.pdf https://www.bls.gov/opub/mlr/2002/05/art2full.pdf Table 4, look at Black participation rates from 1990 to 2015. For intuition think of extended families living together, being incarcerated, and being the last hired and the first fired (so out of work longer).
    - AlexTWithBeard 8y ago
      Thank you. Exactly the answer I was looking for!

hnaccy 8y ago

>Wage trends over the past half-century suggest that a 10 percent increase in the number of workers with a particular set of skills probably lowers the wage of that group by at least 3 percent. Even after the economy has fully adjusted, those skill groups that received the most immigrants will still offer lower pay relative to those that received fewer immigrants. >Immigration redistributes wealth from those who compete with immigrants to those who use immigrants—from the employee to the employer. And the additional profits are so large that the economic pie accruing to all natives actually grows... But behind that calculation is a much larger shift from one group of Americans to another: The total wealth redistribution from the native losers to the native winners is enormous, roughly a half-trillion dollars a year. Immigrants, too, gain substantially; their total earnings far exceed what their income would have been had they not migrated. https://www.politico.com/magazine/story/2016/09/trump-clinton-immigration-economy-unemployment-jobs-214216 https://www.politico.com/magazine/story/2016/09/trump-clinto... Unless you're an immigrant or high up in tech business why would you cheer more high-skill immigrants? It will depress your wages and the economic gains will not accrue to you.

ben_w 8y ago
Either the work is done in your country, where you: * control minimum wage laws etc., * collect the taxes, * benefit from most of the money being spent locally, or it’s done abroad, where a foreign government collects all the benefits. Import duties don’t do much to fix that. And if you have most or all of the workforce, then you get to lobby against other nations’ import duties.
- arcseco 8y ago
  You don't really get to control min-wage laws, working standards or environmental regulations over the long term in a tariff free world. US trade deficits are growing and will inevitably have to be normalized. When that happens the US will have to become a lot more competitive with nations that don't have these standards in place. Stagnated wages are just the beginning and are borrowing time before labour standards and environmental standards are forced to equalize with the East.

pauljurczak 8y ago

> The main point of my comment is that when economists spend 10 years looking at data and arguing out every detail, they conclude that immigration is increasing jobs and increasing wages. Economists look at the past and extrapolate into future, often with really poor results. With increasing amount of automation, software development is probably safe from paradigm change for a short while. Given that, it is always risky to claim that immigration will increase jobs and wages in the next decade, because it did so in the previous one.

irrational 8y ago

So, it went from one person making $41K to two people making $72K ($36k each)? That doesn't seem like a growth situation.

joshe 8y ago
Not quite. From 1974 (they don't have data before that) to 2000, real mean personal income goes from 32K to 43K. [1], that's for individuals. The graph is useful to look at. This is complex, for example there are also more single parent / single person households which tends to lower household incomes. [1] https://fred.stlouisfed.org/series/MAPAINUSA672N https://fred.stlouisfed.org/series/MAPAINUSA672N

joshe 8y ago

I did find personal income growth from 1974 on. That gets rid of the 2 income household problem. I think maybe they only surveyed households til 1974. From 1974 to 2000, real mean personal income goes from 32K to 43K. [1]. The graph is useful to look at. I do think some of the story is that most compensation gains went to benefits, especially our crazy expensive health care (again 5% to 18.2% of gdp). So the hourly wages stayed the same, but benefits went up. I think the original point, that more workers did not lower income, still holds. Really I can't do an Econ Phd to respond to this thread. So I'll outsource to economists, who say more workers do not lower income. [1] https://fred.stlouisfed.org/series/MAPAINUSA672N https://fred.stlouisfed.org/series/MAPAINUSA672N

bradleyjg 8y ago

Your third paragraph is it. This is mostly an out of control health care cost growth story. Three areas of cost growth--health care, education, and housing costs--have now eaten the gains of two entire generation of Americans and none of the three look set to stop their cancerous growth rates any time soon. Way back in the ACA debates, when people talked about bending the cost curve, many people's eyes may have glazed over but that's exactly what we need to figure out a way to do. Not have a debate over immigration.