The Productivity to Paycheck Gap: What the Data Show

Publication Date:

Publisher: Center for Economic and Policy Research

Author(s): Dean Baker

Research Area: Economics

Keywords: Standard of living; Consumption deflator; Health insurance

Type: Report

Coverage: United States

Abstract:

This report makes a series of adjustments to the most common measure of U.S. productivity growth (i.e., non-farm business sector) as well as to measures of wage growth, to determine the extent to which lagging wages can be blamed on weak productivity growth vs. income redistribution. Weak wage growth between 1973 and 2006 has generally been attributed to a redistribution of income from typical workers to higher paid workers. However, the report shows that, along with a redistribution of income, lagging wage growth has also been caused by slow productivity growth.