Labor Day: Time to Ask, “What Happened to the Middle Class?”
This weekend, as you set off for beach trips or barbeques or family reunions, it’s worth taking a moment to remember that Labor Day isn’t just about a much-deserved day off at the end of the summer. It’s about the work that builds this country, and the people who fought to make sure that work is rewarded with decent pay, safe conditions and basic dignity.
Using the power of strength in numbers, working people created something special in this country: a middle class. It didn’t happen by accident, and it didn’t happen because living wages and good benefits were magnanimously handed down from above. It happened because workers stood up and demanded it.
So where is the middle class today? A new study from Pew shows that, after decades of growth, the middle class has seen a real decline in recent years. Middle-class families are looking at lower median incomes, lower net worth and increasing challenges staying middle class. The lost decade wasn’t just about the recession—it was a steady erosion of working peoples’ power, and a corresponding decline in the share of the economy that went to them. Of the people Pew surveyed, 85 percent say it’s harder to maintain their standard of living
There are a lot of reasons for this—like international competition and the increasing power of the financial industry—but first and foremost is that employees have less power on the job. Unions, in particular, have been under attack both at the policy level and in the workplace, as companies are increasingly likely to fight their employees’ attempts to organize. When fewer people have a union on the job, it doesn’t just affect people who might have had unions; it pushes wages and benefits down across the board.
The decline in worker power relative to their employers is obvious from a study released earlier this month by Sentier Research. The recession deeply reduced a lot of wealth and earning power for families. Stubbornly high unemployment reduces workers’ leverage and bargaining power and increases their sense of insecurity. That’s why the recovery has been so uneven:
Corporate profits, meanwhile, have recovered. But with workers producing more on the job, the gains in economic output have not been matched by new hiring.
“The character of the recovery has been one that has benefited businesses more than it has workers,” said Gary Burtless, a Brookings Institution economist.
A new study from the National Employment Law Project shows that the recession shredded mid-wage jobs—and that a majority of the jobs created since have been low-wage jobs.
Over the last few decades, the number of midwage, midskill jobs has stagnated or declined as employers chose to automate routine tasks or to move them offshore…On top of private sector revamps, state and local governments have been shedding workers in recent years. Those jobs lost in the public sector have been primarily in mid and higher-wage positions, according to Ms. Bernhardt’s analysis.
We need policies that support middle-class jobs. That means hiring, rather than firing, teachers, firefighters and police officers. It means making investments in our infrastructure—roads, transit, school construction, communications and energy. And it means funding job training, community college and student aid so that people can acquire skills without being saddled with debt.
This Labor Day, we need to commit to rebuilding a middle class, and making sure people who work can have a decent life on what they earn. Part of that is knowing your rights on the job, and not being afraid to stand up for them. (If you have questions about your rights at work, check out our new site, “Dear David.”) We need to see other working people as partners and allies, not just as the competition.
The middle class didn’t happen by accident. And we don’t just have to accept its disappearance.
