Surprise, surprise, surprise !
It's no secret that the bulk of new jobs created since the Great Recession ended pay low wages, but the extent of the gap between low and high-paying jobs may surprise you according to Yahoo Finance. The press and government really tried to keep it a secret.
The National Employment Law Project reports that that low wage industries employ 1.85 million MORE workers now than at the start of the recession while mid-and higher-wage industries employ 1.83 million LESS.
Low wage industries account for 44% of employment growth over the past four years but only 22% of job losses during the recession. As a result of this imbalance, the take home pay for households has fallen, averaging $51,000 in 2012, or 8% less than the average $55,000 in 2007, adjusted for inflation, according to the NELP.
"The average American continues to lose ground while the wealthiest ... continue to do phenomenally well," says The Daily Ticker's Aaron Task. "People are saying there's a problem not because that guy's getting rich but because (they're) falling behind."
According to Task, The NELP's report encapsulates many elements of the national discussion over "income inequality," including:
Why a 700-page economics tome by a French professor became a sensation, hitting #1 on Amazon.com.
Why polls show a majority of Americans still believe the economy is in recession -- even if the official. arbiter says the recovery began in July 2009 and metrics such as total GDP and total employment have returned to and exceeded pre-crisis levels.
Why the U.S. middle class is no longer the world's wealthiest.
Why there's growing backlash to rising earnings at the top of the income distribution.
While many agree there is a problem, there is little agreement on the solution.
Thomas Piketty, author of the best-selling Capital in the Twenty-First Century, proposes a global wealth tax, which would include include the U.S., among other solutions.
Some conservative groups such as the American Enterprise Institute and Heritage Foundation favor increasing the earned income tax credit.
And in Washington this week, the Senate is expected to vote this week on raising the minimum wage to $10.10 by 2016, as President Obama has proposed. But whether or not the bill passes the Senate it's not expected to pass the House--and may not even come to a vote there.
"I hate the idea that it has to be mandated," Henry Blodget says about raising the minimum wage. "But until we can convince the owners of companies...to take some of that profit and share it with the folks who are creating that value ... we need a higher minimum wage."
And companies can afford to pay it, says Blodget. Companies today now "are more profitable than they have ever been," he says. "They should reward the workers who have created that increased value. Instead, he says "people working full time for McDonalds, Starbucks and Walmart are still poor."