The middle class is the great engine of the American economy. Organized workers built a powerful middle class by taking direct action and advocating for government policies to give workers a fair share of economic wealth. But over the past 40 years, this pattern has been reversed as corporate owners and managers have taken an increasing share of America’s wealth rather than sharing it with workers. As a result, the American economy has sputtered, and more and more Americans are struggling to meet their basic needs.
Higher wages and better benefits helped to build a huge middle class in the United States and to level income inequality. When union membership reached its peak between 1943 and 1958, income inequality dropped (Chart 1). The share of income that went to the wealthiest ten percent of Americans dropped to near 30 percent. But as the proportion of union members fell, the share of income taken by the wealthiest began to rise again. By 2010, the wealthiest were taking home almost 50 percent of the nation’s income.
HOW THE WEAKENING OF AMERICAN LABOR LED TO THE SHRINKING OF AMERICA’S MIDDLE CLASS
As the proportion of organized workers in America plummeted, the nation’s middle-class was decimated. The wealthy steadily took a greater share of the nation’s income, while working peoples’ real wages have been declining since the 1970s. These two phenomena – the weakening of unions and the shrinking of pay – are intricately intertwined. The corporate forces that set out to grab a bigger share of the nation’s wealth deployed an array of strategies, including deliberately attacking unions, which facilitated the concentration of wealth and the deterioration of Americans’ standard of living.
Chosen excerpts by Job Market Monitor. Read the whole story at The Future of Work in America: Policies to Empower American Workers and Secure Prosperity for All
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