Fact check: Are weekly wages in the US ‘below 50 years ago’? | 2024 US Election News

In a November 10 appearance on CNN’s State of the Union, Vermont United States Senator Bernie Sanders dismissed a question from host Dana Bash about whether the Democrats’ poor performance in the 2024 election comes down to policy messaging.

“It’s not texting, Dana,” Sanders said. He said the economy has been weak for Americans for decades.

“It has to be put into context that, 50 years ago, if you can believe it, weekly wages including inflation are lower today than they were 50 years ago, a massive transfer of wealth from the bottom 90. to the top 1 percent,” he said.

However, this figure is cherry-picked. Most data shows that US wages have gained a base above the average rate of inflation compared to the last fifty years.

The most common economic measure of inflation-adjusted wages, which they call “real wages”, is known as the “average weekly wage” for full-time and salaried workers, aged 16 and over. If wages on this scale are higher now than they were 50 years ago, then wages are in line with, or exceeding, the rates of that time. If earnings on this scale are lower than 50 years ago, earnings have lagged behind inflation.

So what do these “real income” numbers show? They show wages outpacing inflation by 10.7 percent over 50 years, from their level in the first half of 1979, the earliest data available. (That’s almost 46 years ago.)

Inflation-adjusted wages have increased over the past 50 years, but not dramatically

It’s not a dramatic increase; it deals with wages rising about two-tenths of a percent faster than inflation annually. However, this data shows that wages have increased more than inflation.

Economists advise ignoring the COVID-19-era spike in wage data; those do not come from earning wages but from the situation of low-wage workers in industries such as layoffs during violence. That left high-wage workers, including those able to work from home, at work, increasing the average or average wage.

We also looked at another data set maintained by the Economic Policy Institute, a liberal think tank. The group looks at inflation-adjusted wages through an income lens, such as the bottom 10 percent of earners, the second-lowest 10 percent, the top 10 percent and the top 5 percent.

Data from the Economic Policy Institute shows that all parts of the income spectrum will earn wages in 2023 above their 1973 level.

Over the past 50 years, wages have risen above inflation for every income segment but faster for the highest-earning Americans.

Wages at the top end of the income spectrum rose faster than wages at the lowest end during that period. But even the wages of low-wage workers have been beating inflation for the past 50 years.

When we asked Sanders’ office about his testimony, a spokesperson pointed to a different set of wage data: average weekly earnings for private sector manufacturing and non-supervisory workers. This data focuses on the most green collar segment of the workforce.

Sanders points out that non-security salaries are low today, but he relies on the destruction of the past 52 years.

Sanders’ office told PolitiFact that the senator is making comparisons to February 1973, nearly 52 years ago. Normally we wouldn’t argue with a two-year difference, but in this case, the choice of date has a big impact on the comparison.

In 1971 and 1972, wages for private sector and non-supervisory workers rose 6 percent, an increase not seen before or since. Sanders’ calculation uses the highest salary figure, February 1973.

Dean Baker, founder of the liberal Center for Economic and Policy Research, said this unusual wage increase was caused by then-President Richard Nixon’s price control policy, which involved a 90-day price freeze, followed by further price increases. which is required to be approved by the “Payment Board” and the “Rate Commission”.

But starting in early 1973, when Nixon ended price controls, this same wage metric fell much faster than it rose, crashing by nearly 9 percent within two years.

If you compare today’s wages to the February 1973 peak, as Sanders did, wages are 3.8 percent lower for the set of earners that includes private sector manufacturing and non-supervisory workers.

But if you look back exactly 50 years before the most recent data for September 2024, wages today are 2.8 percent higher than in September 1974.

“This sounds like cherry picking,” said Douglas Holtz-Eakin, president of the right-wing American Action Forum. “No real effect should be felt from a few data points.”

Again, 2.8 percent is not a huge increase, especially over 50 years, but it is an increase above the rate of inflation, and not a decrease, as Sanders said.

Baker added: “Workers haven’t gotten their fair share of the last half century, but it’s ridiculous to say they’ve gotten nothing.”

He gave another reason to be skeptical of Sanders’ numbers.

“The average work week is about 10 percent shorter now than it was 50 years ago,” Baker said. “Employees chose to have part of their benefits in extra rest.”

Our decision

Sanders said weekly wages adjusted for inflation are “as low today as they were 50 years ago”.

Two measures economists often use for inflation-adjusted wages show higher wages now than they did fifty years ago.

Sanders cited a separate data set for non-custodial workers, showing wages lower now than in February 1973. However, that month represents an unusual high point for wages due to Nixon-era price controls. When price controls are removed, wages fall.

The 50-year average, using September 1974 as the starting point, shows wages rising 2.8 percent above inflation.

We measure the statement Lies.