More than half a century since the Civil Rights Act became law, U.S. workers continue to experience different levels of success depending on their race. Analysis using microdata on earnings shows that black men and women earn persistently lower wages compared with their white counterparts and that these gaps cannot be fully explained by differences in age, education, job type, or location. Especially troubling is the growing unexplained portion of the divergence in earnings for blacks relative to whites.
The minimum wage in St. Louis falls by $2.30 an hour Monday, making it a rare city to buck the national trend of municipal pay floors rising above federal and state levels.
Many low-wage workers in the Gateway City will lose raises they received in May, when the minimum wage increased to $10 an hour. A state law taking effect Monday mandates that Missouri municipalities follow the state minimum of $7.70 an hour, nullifying the higher wage St. Louis officials had sought since 2015.
Average hourly wages are growing at a slightly slower pace over the past 12 months compared with the prior year, according to the Labor Department. Median weekly earnings are growing at a better rate, but gains have been subdued since the recession ended more than eight years ago.
Typically modest wage growth would point to remaining slack in the labor market. But that’s not the case, according to updated research from the Federal Reserve Bank of San Francisco.
“While higher-wage baby boomers have been retiring, lower-wage workers sidelined during the recession have been taking new full-time jobs,” paper authors Mary C. Daly, Bart Hobijn, and Benjamin Pyle wrote. “Together these two changes have held down measures of wage growth.”
It’s apparent that the 11.2 percent return, as welcome as it may be, did not result from any CalPERS investment acumen. As a recent Wall Street Journal article points out, it reflected what was happening across the spectrum of pension funds, thanks to a booming stock market, and, in fact, fell short of the 12.4 percent median return for such funds calculated by Wilshire Trust Universe Comparison Service.
It would take years of double-digit returns to narrow CalPERS’ pension debt, now more than a quarter-trillion dollars, and reach the 80 percent funded level deemed to be minimally sufficient.
The more likely scenario is that the gap between what it needs and what it has will continue to languish, and even grow, even though CalPERS continues to ramp up mandatory “contributions” from state and local governments – or more accurately their taxpayers. Those inflows have more than doubled in recent years, hitting cities especially hard because they devote so much of their budgets to highly paid police and fire staffs that have the most lavish, and therefore most expensive, pension promises.
Although the decline in the manufacturing economy eliminated many good jobs for high school graduates, there are still 30 million good jobs in the U.S. that pay well without a BA. These good jobs have median earnings of $55,000 and are changing from traditional blue-collar industries to skilled-services industries.