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Key figures:
- In 2020, the highest incomes of 1.0% (increased by 7.3%) and the highest earners of 0.1% (increased by 9.9%) saw the fastest growth in annual wages, while the wages of the lowest earners of the 90% increased by only 1.7%.
- In 2020, the 1.0% of the highest income accounted for 13.8% of all wages, up from 7.3% in 1979.
- In 2020, the bottom 90% received only 60.2% of all wages, which is the lowest share since the data were available in 1937 and far below the 69.8% in 1979.
- During the period 1979-2020:
- The wages of the richest 1.0% and the richest 0.1% soared by 179.3% and 389.1%, respectively.
- The wages of the bottom 90% of the population increased by only 28.2%.
New shelf Salary data From Social Security Administration Allows us to analyze the wage trends of the highest 1.0% and other very high-income earners and the lowest 90% in 2020. Beginning in 1979, the upward distribution of wages from the lowest 90% to the highest 1.0% is obvious until 2019 is particularly strong in the 2020 pandemic year, generating the highest wage levels in history, and accounting for the highest 1.0% and 0.1% of all wages. Share. Correspondingly, the income share of the bottom 95% will decrease in 2020.
Two characteristics of the pandemic economy have distorted the 2020 wage model and led to faster wage growth, especially at the top. One feature is that inflation has grown at a moderate rate of 1.2%, which has increased average real wages (but does not affect distribution). The second feature is that with the decrease in employment (the number of income earners decreases by 1.7 million, or 1.6%) and the unemployment rate rises (to 8.1%), the composition of the labor force has changed.Specifically, the unemployment of low-wage workers is the most serious, so the work mix shifts to high-paying jobs, artificially increasing the average wage (see Gould) And produce faster wage growth, especially in the second half.
Last year’s data (Table 1) Shows that the highest income of 1.0% (up by 7.3%) and the highest income of 0.1% (up by 9.9%) have the fastest annual salary growth, while the salary of the lowest 90% has only increased by 1.7%.
Continued growth in wage inequality has weakened the bottom 90% of wage growth, and reiterated the need to create strong wage growth for the vast majority of people, and put the reconstruction of workers’ power at the center of economic decision-making.Look Michel and Bivins Evidence (2021) shows that due to excessive unemployment, erosion of collective bargaining, corporate-driven globalization, weakening of labor standards, new mandatory agreements for employers (such as non-competition), and supply chain dominance, workers’ power has been eroded. This explains wage suppression and wage inequality growth.
As Figure one It shows that the top 1.0% and 0.1% are clear winners during the period 1979-2020:
- The salary of the top 1.0% increased by 179.3%.
- The wages of the top 0.1% of the population have increased more than twice as fast, an astonishing increase of 389.1%.
- Since 1979, wages in the other parts of the top 10% have also grown faster than average, increasing by 53.9% and 83.1%, respectively, but far below the rate of wage growth at the top.
- In contrast, the annual salary of the bottom 90% increased by 28.2% from 1979 to 2020.
This difference in wage growth reflects the long-term sharp rise in the share of the highest-level people in total wages: in 2020, the richest 1.0% earned 13.8% of all wages, up from 7.3% in 1979. This is the second time since the data were available in 1937, the top 1.0% of people have the highest income share (13.8% compared to the technology bubble in 2000, down from 14.1% in 2007). The wage share of the bottom 90% has fallen from 69.8% in 1979 to 60.2% in 2020.
These are the results of EPI Updated salary series By income group, which is developed from publishing Social Security Administration (SSA) data And updated the salary series originally published from 1947-2004 Kopczuk, Saez, and Song (2010). These data are different from our other usual sources of wage analysis (Current census), which allows us to estimate the wage trends of the highest 1.0% and highest 0.1% wages, as well as the wage trends of other categories among the lowest 90% wages and the highest 10% earners.This salary data is Not top coding, Which means that the basic income reported is the actual income, not the “capped” or “highest code” for confidentiality. These SSA salary data are W-2 income, which includes realized stock options and vested stock awards.
Cumulative percentage change in actual annual wages by wage group from 1979 to 2020
| year | Bottom 90% | 90-95th | No. 95-99 | Top 1% |
|---|---|---|---|---|
| 1979 | 0.0% | 0.0% | 0.0% | 0.0% |
| in 1980 | -2.2% | -1.3% | -0.2% | 3.4% |
| 1981 | -2.6% | -1.1% | -0.1% | 3.1% |
| 1982 | -3.9% | -0.9% | 2.2% | 9.5% |
| 1983 | -3.7% | 0.7% | 3.6% | 13.6% |
| 1984 | -1.8% | 2.5% | 6.0% | 20.7% |
| 1985 | -1.0% | 4.0% | 8.1% | 23.0% |
| 1986 | 1.1% | 6.4% | 12.5% | 32.6% |
| year 1987 | 2.1% | 7.4% | 15.0% | 53.5% |
| 1988 | 2.2% | 8.2% | 18.4% | 68.7% |
| in 1989 | 1.8% | 8.1% | 18.2% | 63.3% |
| 1990 | 1.1% | 7.1% | 16.5% | 64.8% |
| year 1991 | 0.0% | 6.9% | 15.5% | 53.6% |
| 1992 | 1.5% | 9.0% | 19.2% | 74.3% |
| 1993 | 0.9% | 9.2% | 20.6% | 67.9% |
| year 1994 | 2.0% | 11.2% | 21.0% | 63.4% |
| the year 1995 | 2.8% | 12.2% | 24.1% | 70.2% |
| year 1996 | 4.1% | 13.6% | 27.0% | 79.0% |
| 1997 | 7.0% | 16.9% | 32.3% | 100.6% |
| 1998 | 11.0% | 21.3% | 38.2% | 113.1% |
| Year 1999 | 13.2% | 25.0% | 42.9% | 129.7% |
| 2000’s | 15.3% | 26.8% | 48.0% | 144.8% |
| 2001 | 15.7% | 29.0% | 46.4% | 130.4% |
| year 2002 | 15.6% | 29.0% | 43.2% | 109.3% |
| Year 2003 | 15.7% | 30.3% | 44.9% | 113.9% |
| year 2004 | 15.6% | 30.8% | 47.1% | 127.2% |
| 2005 | 11.0% | 26.2% | 43.5% | 127.1% |
| year 2006 | 11.6% | 27.8% | 46.7% | 134.8% |
| 2007 | 16.7% | 34.1% | 55.4% | 156.2% |
| Year 2008 | 11.9% | 29.4% | 48.3% | 129.0% |
| Year 2009 | 16.0% | 35.3% | 53.5% | 116.2% |
| year 2010 | 15.2% | 35.7% | 55.7% | 130.8% |
| year 2011 | 14.5% | 36.2% | 56.9% | 134.0% |
| 2012 | 14.6% | 36.3% | 58.3% | 148.3% |
| year 2013 | 15.1% | 37.1% | 59.4% | 137.5% |
| Year 2014 | 16.6% | 38.7% | 62.3% | 149.0% |
| 2015 | 20.5% | 43.1% | 67.9% | 156.2% |
| 2016 | 21.0% | 43.5% | 68.1% | 148.1% |
| 2017 | 22.2% | 44.2% | 69.3% | 157.3% |
| 2018 | 23.9% | 45.7% | 71.3% | 157.8% |
| 2019 year | 26.0% | 51.8% | 75.1% | 160.3% |
| 2020 year | 28.2% | 53.9% | 83.1% | 179.3% |
source: Kopczuk, Saez, and Song (2007, Table A3) and EPI analysis of wage statistics from the Social Security Administration.
A constant wage dynamic in each period since 1979 has been that the bottom 90% of wages have been continuously redistributed upwards.
It’s worth noting that our series on the bottom 90% of wage growth and the Social Security Administration’s Median annual income: From 1991 to 2020, the actual median annual salary increased by 23.5%, not far from the bottom 90% of 28.2% growth rate.
It is also worth noting that the bottom 90% of wage growth between 1979 and 2019 (which ended at the end of the last recovery rather than the bottom of the new recession) was almost entirely concentrated in the two periods of sustained low unemployment, that is, in the 40 years. 11 years: The bottom 90% of wage growth between 1995-2000 and 2013-2019 accounted for 90% of all wage growth during the entire 1979-2019 period (US$7,320 out of US$8,144). In 2019-2020, the bottom 90% of wages will increase by US$676, or 1.7%, which may represent a special situation of pandemic recession and low inflation. The shift of wages from the bottom 90% means that their wages have increased by 26.0% instead of the average of 44.6% during the period 1979-2019, which is about 18.6 percentage points faster. As a result, rising wage inequality reduces the bottom 90% of wage growth by approximately 0.5% per year.
Changes in annual wages by wage group from 1979 to 2020
| Percentage change | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Average annual salary (2020 USD) | long | 2007-2020 business cycle | |||||||||
| Salary group | 1979 | 2007 | Year 2009 | 2019 year | 2020 year | 1979–2007 | 1979–2020 | 2007-2009 years | 2009-2020 years | 2019-2020 | 2007-2020 years |
| Bottom 90% | USD 31,265 | 36,475 USD | 36,253 USD | 39,409 USD | 40,085 USD | 16.7% | 28.2% | -0.6% | 10.6% | 1.7% | 9.9% |
| No. 90-99 | US$102,262 | USD 148,614 | USD 148,228 | USD 167,851 | USD 173,176 | 45.3% | 69.3% | -0.3% | 16.8% | 3.2% | 16.5% |
| 90-95th | 86,717 USD | 116,257 USD | USD 117,345 | USD 131,620 | USD 133,482 | 34.1% | 53.9% | 0.9% | 13.8% | 1.4% | 14.8% |
| No. 95-99 | USD 121,694 | USD 189,061 | USD 186,832 | USD 213,139 | USD 222,793 | 55.4% | 83.1% | -1.2% | 19.2% | 4.5% | 17.8% |
| Up 5% | USD 156,348 | USD 302,375 | USD 276,985 | USD 324,092 | USD 342,987 | 93.4% | 119.4% | -8.4% | 23.8% | 5.8% | 13.4% |
| Up 1% | USD 294,966 | USD 755,627 | USD 637,597 | USD 767,902 | USD 823,763 | 156.2% | 179.3% | -15.6% | 29.2% | 7.3% | 9.0% |
| 99.0 to 99.9 | USD 254,760 | USD 502,071 | USD 459,165 | USD 528,308 | USD 558,349 | 97.1% | 119.2% | -8.5% | 21.6% | 5.7% | 11.2% |
| 99.9-100th place | USD 656,823 | USD 3,037,633 | USD 2,243,480 | USD 2,924,246 | USD 3,212,486 | 362.5% | 389.1% | -26.1% | 43.2% | 9.9% | 5.8% |
| average | 40,296 USD | 53,759 USD | USD 52,345 | 58,254 USD | USD 59,900 | 33.4% | 48.6% | -2.6% | 14.4% | 2.8% | 11.4% |
source: Kopczuk, Saez, and Song (2007) EPI analysis and social security administration wage statistics.
As mentioned earlier, these differences in long-term wage growth reflect a significant redistribution of wages since 1979. The bottom 90% earned 69.8% of total income in 1979, but only 60.2% in 2020 (Table 2). In contrast, the income share of the 1.0% with the highest income has almost doubled, from 7.3% in 1979 to 13.8% in 2020. The wage increase of the 0.1% with the highest income is the main driving force for the 1.0% with the highest income to exceed 0.1%. Its share of earnings has tripled from 1.6% in 1979 to 5.4% in 2020, accounting for 58% of the top 1.0% wage share increase.
Changes in the share of wage groups in total wages from 1979 to 2020
| Share change (ppt.) | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Wage share | long | 2007-2020 business cycle | |||||||||
| Salary group | 1979 | 2007 | Year 2009 | 2019 year | 2020 year | 1979–2007 | 1979–2020 | 2007-2009 years | 2009-2020 years | 2019-2020 | 2007-2020 years |
| Bottom 90% | 69.8% | 61.1% | 62.3% | 60.9% | 60.2% | -8.8 | -9.6 | 1.3 | -2.1 | -0.7 | -0.8 |
| No. 90-99 | 22.8% | 24.9% | 25.5% | 25.9% | 26.0% | 2.0 | 3.2 | 0.6 | 0.5 | 0.1 | 1.1 |
| 90-95th | 10.8% | 10.8% | 11.2% | 11.3% | 11.1% | 0.1 | 0.4 | 0.4 | -0.1 | -0.2 | 0.3 |
| No. 95-99 | 12.1% | 14.1% | 14.3% | 14.6% | 14.9% | 2.0 | 2.8 | 0.2 | 0.6 | 0.2 | 0.8 |
| Up 5% | 19.4% | 28.1% | 26.5% | 27.8% | 28.6% | 8.7 | 9.2 | -1.7 | 2.2 | 0.8 | 0.5 |
| Up 1% | 7.3% | 14.1% | 12.2% | 13.2% | 13.8% | 6.7 | 6.4 | -1.9 | 1.6 | 0.6 | -0.3 |
| 99.0 to 99.9 | 5.7% | 8.4% | 7.9% | 8.2% | 8.4% | 2.7 | 2.7 | -0.5 | 0.5 | 0.2 | 0.0 |
| 99.9th-100th | 1.6% | 5.7% | 4.3% | 5.0% | 5.4% | 4.0 | 3.7 | -1.4 | 1.1 | 0.3 | -0.3 |
source: Kopczuk, Saez, and Song (2007) EPI analysis and social security administration wage statistics.
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