Arin Dube, PhD — a professor of economics at UMass Amherst — has a really eye-opening analysis of what Joe Biden’s policies have done for real wage gains.
Professor Dube, an labor expert, has recently been researching trends in workers’ wages since Biden took office. What he finds is amazing.
First, although inflation made it feel like people were losing in real income (income adjusted for inflation) in the last years, this was more than offset (on average) by rises in wages.
For all workers between 16-65, the median real wage growth turned negative during 2021-22 (between -1 and -2 percent). However, the magnitudes of wage reductions were substantially smaller than what would be suggested by looking at median or mean wage trends (consistent with composition effects).
Moreover, median real wage growth rebounded substantially in 2023. Importantly, if we consider the trimmed or simple means, real wage growth was small but still positive even during 2021 and 2022. In other words, the size of the wage gains tended to be bigger than the size of wage losses.
What else did Professor Dube find?
If we focus on workers in the middle quintile (or middle 20 percent) of initial wages, we find wage growth to be more positive than the workforce overall. The reduction in real wage growth during 2021 and 2022 was smaller for these middle income earners than the workforce overall—whether we look at the mean, the trimmed mean, or the median.
For this group, the mean change in real wage was 1.2 percent annually, while the median change was around -1.1 percent. But wage growth has strongly rebounded subsequently in 2023 (to 3.3 percent for the mean and 1.3 percent for median).
And here is the real kicker:
If we consider the bottom 80 or 60 percent of earners based on initial wage, the picture looks rosier. In both cases, the mean, median and trimmed mean wage growth were all positive even in 2021-2022. In other words, the real wage reductions in 2021-2022 were disproportionately a high-wage worker phenomenon. [emphasis added]
For the bottom 60%, the median wage growth was 1.8 percent in 2021 and 1.4 percent in 2022. The magnitude of the fall in wage growth was more modest for this group. Interestingly, for this group, mean wage growth in 2021-2022 was only modestly lower than pre-pandemic period—which likely reflected the sizable wage gains that accrued to job switchers at the bottom of the distribution.
Biden’s policies of building from the bottom and middle up ARE WORKING. Check out this chart:
Can you read that caption? It’s worth repeating in any case:
Real wages have grown most strongly for low-wage workers, and they have fallen for high-wage workers, reducing inequality.
Wow!
Is there still more work to be done? 100%! Lots more work. But Biden has done so much more than many people guessed could be done. He deserves a lot of credit. AND he deserves to be re-elected.
What can you do to help?
Your donation will come bundled with others from our Good News community and will show Biden that there are many of us who support him and combine hard work with optimism in our battles for a better America!
Want to do something else?
Rec and comment on these posts to keep them alive at DKos and share them with others who might not realize how great a president Joe Biden has been.
Looking for something else? Here are some other ideas:
This is an entry in my ongoing series Boosting Biden.
Check the comments for more information on how to find other entries and subscribe.
These posts are written by Goodnewsroundup (Goodie),
edited by Matilda Briggs, supported by 2thanks and WolverineForTJatAW,
and reinforced by several other notable Kossacks!
As with all good things, it takes a village.