Tax Cut no Cure for Middle Class Economic Woes

Publication Date: September 1999

Publisher: Economic Policy Institute

Author(s): Robert E. Scott; John Schmitt; Edie Rasell; Jared Bernstein

Research Area: Economics

Type: Brief

Abstract:

The strong economy of the past few years has lifted the fortunes of most working families. At the bottom of the wage and income scales, workers whose living standards declined steadily over the past 25 years have benefited from both the tight labor market and the increase in the minimum wage.

At the top of the income ladder, the wealthy have continued to enjoy wage and income growth and have reaped huge gains from the growth in the stock market. But what about the middle? Neither the minimum wage nor the stock market does much for workers in middle-income families. The tight labor market has helped those in the middle class, but the gains have been modest compared to the benefits received by those at the bottom.