State of Working PA: Despite a Growing Economy, Everyday Workers' Wages Remain Stagnant

Wages over the past decade have fallen for most of the bottom 60 percent of Pennsylvania workers.

Read the full report

HARRISBURG, PA – Ahead of Labor Day weekend, the Keystone Research Center today released the 23rd edition of its report The State of Working Pennsylvania. The report finds that, after adjusting for inflation the bottom 60% of Pennsylvania workers are still earning less today than a decade ago.

The report points to three factors that help explain this. Despite low unemployment, some slack remains in the job market. Second, employers – led by giant service-sector employers of millions of low-wage workers – use their market power over workers ruthlessly to repress wages. Third, national and state public policies, shaped by legislatures with Republican majorities and federal courts (including the Supreme Court) dominated by conservative justices, push mostly in the wrong direction. They keep rigging the economy further against ordinary workers. Where Pennsylvania’s current Governor and Attorney General have authority to act independently they have sought to lift wages. Faster and greater progress in Pennsylvania requires state lawmakers to row in the same direction.  

The Pennsylvania economy has grown steadily since the current economic recovery began in the middle of 2009. Non-farm employment now exceeds the level in early 2010 by 8%. Unemployment has fallen to less than half its post-recession peak – to 4.2% in July 2018. Yet Pennsylvania workers’ wages remain stubbornly unmoved by steady economic growth. 

  • Wages for workers throughout most of the Pennsylvania wage distribution fell in the 12 months ending in June 2018.
  • Wages over the past decade have also fallen for most of the bottom 60 percent of Pennsylvania workers.

Meanwhile top 1% incomes, which took a dive with the stock market crash in and after the Great Recession, are back on the fast track.

  • Top 1% earners took home one third of the increase in Pennsylvania income from 2009-15 (the latest period for which these data are available).
  • And Pennsylvania income other than typical wages and salaries (“non-withholding income”), which goes mostly to high earners (e.g., dividends, capital gains, and profits) increased a robust 7.8% in the last 12 months (i.e., the fiscal year ending in June 2018).

"State policies that we summarized in 'State of Working Pennsylvania 2016' as 'The Agenda to Lower Pennsylvania’s Pay' remain influential with the majority caucus in the legislature," said State of Working Pennsylvania author and Keystone Research Center Labor Economist Mark Price. "So far, these lawmakers must be considered successful: as many of their constituents after factoring in inflation earn less today than their counterparts did 10 years ago."

RESOURCES:

Read the Full Report (PDF)

Summary of "Agenda to Raise Pennsylvania's Pay" from 2017 State of Working PA (PDF)

Past State of Working Pennsylvania Reports

 

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