BTC Brief: Working hard for an economy that's hardly working
By Allan M. Freyer
Public Policy Analyst, Budget & Tax Center
North Carolina's workers increase productivity, get paid less for first time in 30 years
- The economic recovery from the Great Recession is different from any recovery in the last 30 years, as seen in unprecedentedly sluggish job creation and, perhaps most obviously, falling wages.
- A unique feature of the current sluggish recovery is the productivity gap, in which—for the first time in 30 years—rising worker productivity (a key driver of economic growth) is not being rewarded with higher wages.
- This productivity gap has contributed to the emergence of a two-tier labor market, with growth in low-wage and high-wage occupations, but little growth in between. The result is the worst wage inequality seen in 30 years.