Quick Hit Ellyn Fortino Wednesday June 1st, 2016, 4:17pm

Report: Real Wages Declined The Most For Low-Paid Workers Since Great Recession

Real wages have declined for the majority of U.S. workers since the Great Recession ended, but they have dropped the most for those employed in the nation's lowest-paid occupations, according to a report by the National Employment Law Project (NELP).

"Stagnant wages have become a fact of life for nearly all of America's workers, but workers in lower-paying occupations are finding it especially tough to keep up with the rising cost of living," NELP's Executive Director Christine Owens said in a statement. "Not only are their paychecks not growing, but their purchasing power has shrunk considerably, and to a far greater extent than that of higher-wage earners."

NELP's report examined Occupational Employment Statistics (OES) data from the U.S. Bureau of Labor Statistics. It ranked 785 occupations highest to lowest based on their median hourly wage for 2014, and separated those jobs into five approximately equal groups. For each group, NELP calculated the percentage change in real, or inflation-adjusted, median hourly wages from 2009 to 2014.

Across all occupations, real median wages fell by an average of 4 percent from 2009 to 2014, the report found.

Real wages decreased the most -- by an average of 5.7 percent -- for the lowest-paying occupations over that time period. Those jobs had median hourly wages between $8.84 and $10.97 in 2014.

Overall, average real wages for jobs within the bottom three-fifths of the occupational distribution declined between 4 percent and 5.7 percent from 2009 to 2014, according to the report.

At the high end of the spectrum, jobs in the top two-fifths -- which had median hourly earnings between $19.21 and $87.36 in 2014 -- saw real wages fall no more than 3 percent, on average, from 2009 to 2014.

NELP's report also looked at wage declines among the 10-largest occupations within the lowest-wage group. Cooks and food preparation workers in this category saw their real wages drop the most, falling by 8.9 percent and 7.7 percent, respectively. That translates into approximately $2,185 less in income for cooks and $1,622 for food preparation workers in 2014 compared to 2009.

Janitors, personal care aides, home health workers and maids all had real wage declines higher than 6 percent.

Fast food workers experienced wage declines slightly below the 4 percent average, the report showed. Real wages for the occupational category of "combined food preparation and serving workers, including fast food," dipped 3.9 percent.

Connie Bennett, 58, is a McDonald's worker on Chicago's South Side and has experienced sluggish wage growth during the economic recovery.

She's worked for the fast food giant for more than eight years. Over that time, Bennett said her rent, utilities and other costs increased, but her pay has barely budged.

Before the city of Chicago's new hourly minimum wage of $10 took effect last year, Bennett said she made $8.45 an hour at McDonald's and had received only a nickel raise since being employed there.

Bennett currently makes $10.10 an hour as a McDonald's "training manager."

"It's still not enough to pay your bills," she said of her $10.10 wage. "The cost of everything has gone up."

The report includes several policy recommendations to help reverse wage decline and stagnation, including bumping the minimum wage to $12 at the federal level and $15 in cities and states with higher costs of living.

"Wage stagnation and the decline in real wages during the recovery is part of a longer-term trend that goes back decades. Continued slack in the labor market, combined with the historically low share of U.S. workers represented by unions, has greatly limited workers' ability to bargain for higher wages," said Owens. "The question now is what we can do about it. We can start by raising the federal minimum wage, enforcing wage protections aggressively, and restoring workers' freedom to bargain collectively. Steps such as these can help reverse income inequality and begin to straighten out our economic priorities."


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