Wages for low-income workers are on the way up, according to a new report by the Economic Policy Institute (EPI), thanks to increases in the minimum wage. But there are still large, systematic gaps that must be conquered if real income inequality reform is going to take place.
According to findings detailed in “The State of Working America: Wages 2018,” state-level minimum wage hikes have spurred wage growth between 2017 and 2018 for workers earning in the bottom 20 to 30 percent of the nation. That fact, said EPI senior economist Elise Gould said, is proof that “policy matters.”
But those laws can only do so much.
“Since 2000, wage growth has been strongest for the highest-wage workers, continuing the trend in rising wage inequality for the past four decades,” Gould said. “Additionally, many working people, particularly working women and black workers are still facing persistent and, in some cases, worsening wage gaps.”
In fact, EPI’s analysis of data from the Current Population Survey found that the wage gap between African-American and white workers were larger in 2018 than in 2000. Among black workers, only college and advanced degree holders had higher wages than 2000, but their wage growth was significantly less than white and Latino workers with the same degrees.
A significant wage gap also exists for female workers across levels of educational attainment. As it stands, men with only a college degree are paid more on average than women with advanced degrees.
Of course, there is a way for all workers to increase their pay – join a union! The median union worker makes almost $10,000 more a year than the median non-union worker. Plus, they are more likely to receive benefits and have a retirement plan. Unions like the Teamsters bargain hard to provide equal pay for everyone, no matter their gender, race or ethnic background. That cannot be understated at a time when equality is not being happening in most workplaces.
The market, left to its own devices, is not providing a level playing field to hardworking Americans. Years of data makes that clear, and it is silly to think it is going to get fixed on its own. Lawmakers have a role to play to improve this, but workers can as well.