Great analysis by Prof. Mark Perry (AEI Scholar) … entire analysis is worth reading … here’s the essence of the argument.
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Question: It’s oft-reported that household income has been falling … but, digging into the data, hourly earnings have been increasing.
How can that be?
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According to Prof. Perry’s analysis, the answer lies in “mix” – the composition of households ….
Lots of end-zone dancing last week re: the economy.
The President says that all indicators are good, and that folks who aren’t feelin’ it just “don’t get it” because they’re watching FoxNews too much.
Say, what?
Let’s look at the ultimate measure: household income.
Adjusted for inflation, median household income dropped 8% during the recession … and has been flat after bottoming out a couple of years ago.
That means that the median real household income is still down 8% from the pre-recession peak.
Hard to get excited about that, right?
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The drop in median household income has come despite a steady increase in average hourly wages … they’re up about 10% since the official end of the recession.
That’s before inflation, but the Feds keep telling us that inflation is negligible, that shouldn’t matter, right?
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Let’s see, average wages are going up, but median household income is stalled at a depressed level.
What’s going on?
The Dems are touting 4.5 million jobs created by President Obama.
CNN says that the number is an accurate description of the growth of private-sector jobs since January 2010, when the long, steep slide in employment finally hit bottom.
But – and it’s a BIG but — while a total of 4.5 million jobs sounds great, it’s not the whole picture.
Nonfarm private payrolls hit a post-recession low of 106.8 million January 2010 … The figure currently stands at 111.3 million as of July.
While that is indeed a gain of 4.5 million, it’s only a net gain of 300,000 over the course of the Obama administration to date since the private jobs figure stood at 111 million in January 2009, the month Obama took office.
And total nonfarm payrolls, including government workers, are down from 133.6 million workers at the beginning of 2009 to 133.2 million in July 2012. There’s been a net loss of nearly 1 million public-sector jobs since Obama took office, despite a surge in temporary hiring for the 2010 census.
Meanwhile, the jobs that have come back aren’t the same ones that were lost.
According to a study released last week by the liberal-leaning National Employment Law Project, low-wage fields such as retail sales and food service are adding jobs nearly three times as fast as higher-paid occupations.
