The State of Working America, 200203

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The State of Working America, 2002-03

• The labor market recession, which began in
  October 2000 remains with us.
• This recession marks the end of the long economic
  boom of the 1990s, which brought the first,
  broad-based increase in wages and incomes in
  decades.
• Low-wage workers especially benefited, as poverty
  rates dipped to historic lows.
• The 1990s also brought, however, substantial
  increases in household debt.
• The long-term trend towards increased hours of
  work continues and having a working mom remains
  a salient fact of American family life.

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The 5.7 unemployment rate obscures the
recessions true depth

• Employment losses are steeper during this
  recession than in the early 1990s recession.
• Higher unemployment has been more broadly shared
  by education and by gender.
• Long-term unemployment has increased, especially
  for women workers.
• Slower wage growth is already occurring,
  especially among low-wage workers.
• Expect to see increased inequality as a result.

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The unemployment rate and its trend, 1947-2000
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Monthly payroll employment growth from
unemployments low-point over the past three
recessions
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Percentage point change in unemployment during
recession
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Percentage point change in unemployment during
recession for men.
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Percentage point change in unemployment during
recession women.
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Nominal growth in average hourly earnings,
1995-2002
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Nominal earnings growth for men,comparing first
halves of the year
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Nominal earnings growth for women,comparing
first halves of the year
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Full Employment Love it when you've got it, miss
it when it's gone

• What is it? Close to full utilization of economic
  resources, including the un- and underemployed.
  Corresponds to unemployment rate in the
  neighborhood of 4.
• Full employment led to sharp reversals in real
  wage and income growth these gains were
  broad-based.
• Full employment is not, however, a cure-all
  (especially as it was short-lived). Racial,
  gender, and poverty gaps still exist.
• Inequality's growth slowed-an important source of
  poverty reduction-but it did not stop, as top
  continued to pull away.

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Growth in median family income over the 1980's
and 1990's
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Ratio to white median family income by
race/ethnicity,1947-00.
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Low (20th percentile), middle (50th), and
high-income (95th) growth
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Ratio of average family income of the richest 5
of families to the poorest 20
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Real family income growth by quintile, 1947-73
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Real family income growth by quintile, 1973-00
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Changes in unemployment and income during recent
recessions and recoveries
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Poverty rate, 1959-2000
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Change in poverty rates, 1979-2000, children
under 6 by race/ethnicity
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Employment rates for mothers, 1985-2000
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Share of poor families with no work, by
race/ethnicity, 1979-2000
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Income components, low income single mothers,
1979-2000
Earnings Share
Public Assistance Share
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Income of low-income single mother families,
gross and net of work expenses, 1979-2000
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Real hourly wages of low-wage workers (20th
percentile)
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A little wealthier, much more indebted

• Over the 1990s, even as the stock market boomed,
  most Americans held little or no stocks.
• By 1998, only 36.3 of households owned more than
  5,000 in stock either directly or indirectly,
  through a 401k or mutual fund.
• The bottom 40 saw their stock market holdings
  rise by only 1.1.
• For many families, it was the run-up in debt that
  was most dramatic over the 1990s,

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Change in assets and liabilities of middle-wealth
households, 1989-98
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Home ownership by race
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Debt as a percent of personal disposable income,
1947-2001
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Consumer bankruptcies per 1,000 adults
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Americans are working longer

• Over the 1990s, we saw a continuation of the
  trend toward longer hours of work.
• This was driven by the increase in womens labor
  supply, and in particular, there are more working
  mothers.
• Nearly three-quarters of all moms work.
• The average two-parent family has one worker at
  full-time and one at a little over 30 hours per
  week.

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Annual work hours of middle income,
married-couple families with children
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Average annual hours worked among selected OECD
countries, 2000
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Change in average annual hours worked, selected
OECD countries, 1979-2000
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Percent of workers with access to paid vacation,
by industry, 1997
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Percent of workers with access to paid holidays,
by industry, 1997
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Americans are more likely to be poor

• The United States has more children in poverty
  than in any other OECD nation.
• The exit rate from poverty is much lower in the
  United States than in other OECD nations.
• In the United States, entry into poverty is
  nearly twice as likely as other OECD nations to
  be associated with a new child in the family.

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Percent of population remaining poor for at least
three years, mid 1990s
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Child poverty is higher in countries with lower
social expenditures
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Percent of wages replaced during maternity leave
(weeks of paid leave)