Currently, about 63 percent of Starbucks employees make under $15 an hour, according to data from the Economic Policy Institute. It’s unclear how that percentage will change with union members and unionizing workers excluded from the pay raise.
By 1990, voter indignation at the rising CEO-to-worker pay gap swelled to the point that Bill Clinton made it a major promise of his “Putting People First” campaign that if he was elected, he would put an end to it. Clinton got elected in 1993 and immediately said he would keep his promise. Let’s look at a graph prepared by the Economic Policy Institute that shows the rise in CEO to worker-pay ratio from the mid-1960s to 2018. Notice how after Clinton’s reform, the ratio skyrocketed.
“While much has changed” since the Haymarket bombing, arrests and frame-up of pro-worker activists in Chicago in 1886, “several core dysfunctions of that older economic system persist,” the Economic Policy Institute says.
But college enrollment has fallen since 2020. Elise Gould with the Economic Policy Institute says the pandemic added new roadblocks for many minority and lower income potential students who may not have been able to come up with tuition.
According to the Economic Policy Institute, a nonprofit think tank, a family with two children, age four and eight, is projected to pay an average of $16,659 on child care in 2022. This amount varies across the country, however. In some states, child care costs are far lower than the national average, while in others, families are paying thousands more.
But the reduction in supply was met with increased demand as Americans started purchasing durable goods to replace the services they used prior to the pandemic, said Josh Bivens, director of research at the Economic Policy Institute.
What we learned on these earnings calls was quickly reflected in data. Despite the rising costs of labor, energy and materials, profit margins reached 70-year highs in 2021. And according to an analysis from the Economic Policy Institute, fatter profit margins, not the rising costs of labor and materials, drove more than half of price increases in the nonfinancial corporate sector since the start of the Covid pandemic.
“Workers continue to quit and get hired at fast rates in today’s economy. This ‘churn’ is a positive sign of a strengthening labor market where workers can quit, search, and obtain new opportunities,” said Elise Gould, senior economist at the Economic Policy Institute.
By 1990, voter indignation at the rising CEO to worker pay gap swelled to the point that Bill Clinton made it a major promise of his ‘putting people first’ campaign that if he was elected, he would put an end to it. Clinton got elected in 1993 and immediately said he would keep his promise. Let’s look at a graph prepared by the Economic Policy Institute that shows the rise in CEO to worker pay ratio from the mid-1960s to 2020. Notice how after Clinton’s reform, the ratio skyrocketed.
“The key thing is productivity is actually measured by taking GDP and dividing it by hours worked. And GDP was freaking weird in the first quarter,” Heidi Shierholz, the president of the Economic Policy Institute, told Fortune. “If you dig into the GDP numbers, you actually see healthy growth, but the top-line GDP numbers are negative because of a decline in inventories and an increase in imports, which has nothing to do with workers becoming less productive.”
“One of the reasons why we continue to see persistent pay disparities both in gender and race is so much of the process and decision making about salary is hidden or secretive,” said Valerie Wilson of the Economic Policy Institute, a left-leaning think tank.
“The cost of childcare has been increasing rapidly over the past several decades,” says Zane Mokhiber of the Economic Policy Institute. The bottom line, experts say, is also a big part of the problem. The non-profit Economic Policy Institute put together an interactive site, showing the average annual cost of infant care in Missouri is now more than $10,000. That’s 4% more than the average cost of housing and nearly 20% more than in-state tuition for a four-year college.
According to the Economic Policy Institute, millions of workers are paid less than they’re legally owed every year. In its latest analysis, the independent, nonprofit think tank found that between 2017 and 2020, more than $3 billion in stolen wages were recovered for workers by the U.S. Department of Labor, state departments of labor and attorneys general, as well as through class and collective actions.
According to a new report by Josh Bivens at the Economic Policy Institute, over half of price inflation since March 2020 (he estimates 53.9 percent) is attributable to fatter profit margins, while labor costs account for less than 8 percent. As the chart below shows, from 1979 to 2019, profits contributed only a bit over 11 percent to price growth, and labor costs over 60 percent. Corporate power has built up over the last forty years, and the pandemic-driven demand surge has given firms even more pricing power vis-à-vis their customers. Powerful firms have also been free to pass on cost increases to their customers because they don’t face strong competition, and have been using the cover of “inflation” to add even more to their profit margins.
Still, according to a recent analysis by the Economic Policy Institute of educator pay statistics, nationwide teachers on average make 19.2% less annually when compared with similarly educated workers, NEA officials said.
The Economic Policy Institute had a very useful analysis of this data just before the pandemic. Between 1979 and 2000, there was a rough match between growth in one measure of overall inequality — the gap between wages at the 95th percentile and those of the median worker — and its estimate of the average wage premium for college-educated workers. Since 2000, however, wage inequality has continued to rise, while the college premium has barely changed:
That relief could extend to the nation’s tight labor market, says Daniel Costa of the Economic Policy Institute.“There’s not just an impact on the individual, but there’s an impact economy-wide,” said costa.
Paying teachers more is a simple method to solving the shortfall, a recent report by the Economic Policy Institute stated.
Since the start of the pandemic in 2020, state and local public education employment — ranging from K-12 teachers to school bus drivers to school custodians — have fallen by nearly 5% overall, the EPI authors noted.
The NEA used the Economic Policy Institute’s family budget calculator to determine whether support staff make a living wage and found that on average, these employees would not be able to live in a metropolitan area and support themselves and one child without government assistance or another adult’s income.
A 2021 report by the Economic Policy Institute said unionization in the cannabis industry could lead to safer jobs that pay between $2,810 to $8,690 more per year than in what it describes as a “low-road scenario,” where cannabis workers would have few to no workplace protections. Workers at unionized cannabis businesses also enjoyed more workplace benefits, including health care, paid leave and fairer scheduling practices.
As Josh Bivens of the Economic Policy Institute notes, if one producer is temporarily sidelined, or otherwise forced to cut back production, this provides opportunities for competitors that are not as hampered to jump in with price increases.