wages

Hardworking Californians are struggling to keep up, let alone get ahead in an economy that has an increasing divide between those at the highest income level and those at the lowest. The middle class is simply disappearing. The California Budget Project has issued a new report that they released today called "A Generation of Widening Inequality: The State of Working California, 1979 to 2006".

Today, the gap between the earnings of California's low-wage and high-wage workers is greater than it was a generation ago, reflecting a sharp decline in the purchasing power of high-wage workers' hourly earnings. Meanwhile, the hourly wage of the typical worker- the work eactly at the middle of earnings distribution- has barely kept pace with inflation. The gap between low-wage and high-wage workers has widened to a greater extent in California than the nation as a whole because the states low-wage workers have fared worse than their US counterparts, wile the state's high-wage workers have fared better.

Workers at the bottom pay range dropped 7.2%, while the rich saw their pay go up 18.4% during the time period studied. The most likely wages for jobs added in the next decade "will pay either quite well or relatively little", at either about $83,000/year or $21,000/year. LAT:

The findings underscore "the extent to which inequality in California exists," said Jean Ross, executive director of the Budget Project, which focuses its research on matters that affect low- and middle-income households. "A significant fraction of the California workforce is falling behind."

Most of the new jobs that have been generated in recent years have been for engineers, executives, lawyers and scientists at the highest tier -- paying more than $22 an hour in 2006 dollars -- and for store clerks, cashiers, nurses' aides and farmworkers at the lowest tier, paying less than $11 an hour, the report said.

In fact, from 1999 to 2005, according to the report, 43% of new jobs paid less than $11 an hour.

It's not just wages, people are working harder and getting less benefits.

But many findings weren't upbeat. To stay financially afloat, many Californians have had to work harder and longer while receiving fewer benefits from their employers, the report said. And despite the economic recovery that began after the recession ended earlier this decade, advantages that some workers might have expected to "trickle down" never did.

"Typically, such trends provide ripe conditions for broad-based increases in living standards," the report said. Instead, soaring productivity gains led to "skyrocketing corporate profits."

The good news in the report was spotty: the value of a college degree has gone up and the disparity between women and men has gone down. Wages for Asian Americans have gone up, but Latinos have lost ground. The average Latino now earns 58 cents for every dollar a white worker makes, down from 71 cents in 1979.

I like Elliot's phrase so I am stealing it for the title.

Circuit City deserves it for its move to fire 3,4000 of their most experienced sales staff so they can re-hire low-wage workers. Sure, the fired employees can re-apply for their jobs after 10 weeks, but at the minimum wage. 621 of them are Californians. These new hires don't need to have any sales experience. I am sure that will do wonders for customer service. From the LADN:

The cuts will boost Circuit City's short-term outlook but could kill the stores in the long term if new hires don't offer the same level of customer service, said Jack Kyser, vice president and chief economist at Los Angeles County Economic Development Corp.

"At the end of the day, it's still the interaction between somebody on the selling floor and the customer," Kyser said. "If there's not a reason to come back because of bad service, that's the kiss of death."

Look what it is already doing for employee morale for those who are left:

Timing of the layoffs, two weeks before performance reviews that often come with pay raises, spooked a Circuit City employee who was not laid off and earns $10.50 an hour. He refused to give his name because of a policy that employees not speak to the media.

"You're going to walk in the (manager's) door, and for the first time you're going to say I don't want a raise," he said. "If you take the raise, will you lose your job?"

Is that their strategy? Scare the pants off of those who are left so they don't have to even give them raises?

Rep. George Miller, the chair of the House Education and Labor Committee issued a press release today on the subject:

Let's get one thing straight: The workers fired by Circuit City were not overpaid. According to the Washington Post, one worker who lost his job was making roughly $12 per hour. A full-time worker making $12 per hour would earn about $24,000 a year. That's barely enough to pay the bills.

Meanwhile, Circuit City's six top executive officers brought home a total of roughly $16 million in salaries and bonuses from 2004 to 2006. Clearly, workers who had been loyal to the company for years and who earned $12 per hour were not the ones who were overpaid. Circuit City's actions are reprehensible. Loyal workers who devote years of service to a company deserve to be treated with dignity and respect.

You know...I really need to get a printer cartridge tonight. Guess where I am not going?