The recent “economic recovery” continues to leave average American workers behind. With employers squeezed, their workers are experiencing the effects of cutbacks from the first quarter, which has created the most extensive drop in hourly pay on record.
According to a report from the Bureau of Labor Statistics last week, hourly pay in the first quarter fell at a 3.8 percent annualized rate. This marks the largest decline since the BLS began keeping records back in 1947. Some of that decline was a kind of “snapping back” from a 9% surge in hourly pay in the fourth quarter of 2012, as employers dumped money out to avoid tax hikes they anticipated for 2013.
However, many economists and employment attorneys fear that this may be a sign of things to come rather than a one-off exception. Over the past four years, hourly wages have increased by a mere 2% per year, on average. Meanwhile, corporate profits hit record highs, along with the stock market. Workers have been getting squeezed, while employers rake in the profits.
Another problem to note is that worker productivity grew by only 0.5% in the first quarter, according to BLS records. That’s even shakier than the 0.7% increase in 2012 or the 0.6 percent gain for 2011. And none of this looks good when measured against average annual gains, which fall around 3% in 2009 and 2010.
Weaker productivity could be good news. Maybe employers have hit the limits of how much they can squeeze out of their workers, meaning they’ll need to hire more employees soon.
Yet the trend is not promising from the perspective of future growth. The U.S. economy had experienced four consecutive years of mediocre productivity leading up to the Great Recession. Stagnant productivity chips away at living standards and leaves companies with fewer resources for research and development, which is an essential practice for creating jobs of the future.
Work Injury Attorneys
While Emery Reddy attorneys certainly can’t fix the U.S. economy, we can offer other forms of help to Washington workers. If you have a work injury, or need assistance recovering your workers compensation benefits from the Department of Labor and Industries, contact our office today.