PROSPERITY WATCH (Issue 63, Number 2): Decline in wages for North Carolina workers among deepest in the South

July 27, 2016
In an economic expansion like the one the nation and North Carolina has experienced since 2009, workers should see their work wages at least keep up with the cost of basic goods and services, ultimately allowing them to support their families and participate in local economies across the state. The current economic expansion for the median North Carolina worker has failed, however, to deliver this critical outcome. The result is that families and the broader economy are struggling to reach full strength.
Analysis of the growth in median worker’s wages across Southern states from 2009 to 2015 finds that North Carolina has underperformed the nation and many states in the South. A worker in the middle of the earnings distribution in North Carolina saw the value of an hours work decline by 3.9 percent nearly two times the decline experienced across Southern states. Georgia and Florida saw greater declines for their workers’ wages, which is concerning given that those states have been held up in policy debates as examples that North Carolina should follow. 
North Carolina’s poor performance in ensuring that the economic recovery generates benefits for everyone isn’t inevitable.  It is the result of policy choices that have failed to ensure that the minimum wage standard keeps up not just with the rising cost of goods and services but also with the increased productivity of workers.  As we look back this week at the last time the minimum wage standard was increased by Congress 7 years ago, we should also look to the future of North Carolina’s workers if the state’s recovery continues to lag behind the nation and most of the South.

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