Ohians See Drop in Income Since ’70s: Inflation, Job Exodus Erode Average Wage

Cincinnati Enquirer - September 1, 2002
   

Cincinnati Enquirer

By Ken Alltucker 

Here’s a sobering Labor Day revelation: Two decades
ago, Ohioans worked less and were paid more for their
efforts.

That’s the conclusion of a new report from an Ohio think
tank that analyzed two decades of income data culled from
U.S. Census Bureau surveys.

The study, to be released today by Policy Matters Ohio,
illustrates a declining standard of living for most Ohioans.

Also, black income gains trailed whites, but females made
great strides even if they still lag behind their male coworkers.

The typical Ohio worker earned $12.81 an hour in 2001,
down from $13.73 (adjusted for inflation) in 1979.

Most of that drop came during the 1980s when Ohio’s
manufacturing job base began to shrivel. Since 1989, median
hourly wages have risen 41 cents.

Even though Ohio families tend to earn more than the
typical U.S. family, the overall trend for most working Ohioans
is nothing to celebrate, said Amy Hanauer, executive director
of Ohio Policy Matters and one of the report’s authors.

It used to be a high-school-educated man in Ohio could
get a manufacturing job and get a decent wage, Ms.
Hanauer said. Now, there are fewer (good-paying) jobs for
unskilled or low-skilled workers.

The study doesn’t include a breakdown of wages by
different sectors or education levels. Nor does it contain data
for cities, counties or even neighborhoods. A more detailed
look at household income by race and many other details for
Cincinnati and other cities will be released Wednesday by the
Census Bureau

Nevertheless, it confirms a trend that many labor
researchers agree harms Ohio workers and families.

George Zeller, senior researcher of Council for
Economic Opportunities in Greater Cleveland, said Ohio’s
wage decline is likely the result of steep job losses in the
state’s manufacturing sector.

We are losing manufacturing jobs, Mr. Zeller said.
That is a very serious problem. You have these workers who
were making a pretty good living then become downwardly
mobile.

The report concludes that the gap between rich and
poor has widened. The economic good times of the 1980s
and 1990s proved truly beneficial for the top 21 percent of
wage earners; pay dropped for everybody else.

Of course, not all workers shared the pain equally.

Wage gains of black men and women trailed whites.

Earnings for Ohio’s white and black men both declined
since 1979, but the average white man’s $15 hourly wage is
$3 more an hour than the average black man’s. What’s more,
while white men’s hourly earnings have rebounded slightly (2
cents an hour) since 1989, wages of black men dropped 40
cents.

People tend to think that’s not true, but it’s what I say on
a daily basis, said Jim Clingman, a consultant who teaches
classes on black entrepreneurship. It tells me from a black
perspective that we have a whole lot of work to do.

The picture is brighter for working women. Wages
increased 10.3 percent since 1979 to $11.17 an hour. White
women fared better than black women.

Despite the overall wage decline, Ohio households are
earning more than a decade ago. That’s largely because
dual-income families are working longer hours in order to
afford expenses such as housing, child care and health
insurance.

The typical married couple with children worked 72
hours a week from 1998 to 2000, up from 61 weekly hours
from 1979 to 1981.

Increasingly, families are deciding extra work hours are
needed to maintain a standard of living that used to be
possible with one wage earner, the report concludes.

The need for families to work longer hours is 
exacerbated by the rising costs of housing and health care. 

Many Ohio companies have pared or eliminated benefits
such as health insurance and pensions to save costs.

The percentage of working poor remains steady. In
1979, 23.9 percent of workers earned wages below the
poverty level vs. 23.5 percent in 2001. More and more men
are taking poverty-level jobs (defined as a job that pays $8.71
an hour or less), up more than 50 percent during the past two
decades.

The study’s findings point to the need of new laws for
Ohio workers such as minimum wage increases and a
refundable earnings income tax credit, Ms. Hanauer said.

Wages just haven’t caught up from the 1979 level, she
said. I think the jobs have gotten worse. “Increasingly,
families are deciding extra work hours are needed to maintain
a standard of living that used to be possible with one wage
earner.’

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