Chapter contents

• Key findings
  • America’s vast middle class has suffered a ‘lost decade’ and faces the threat of another
  • Income and wage inequality have risen sharply over the last 30 years
  • Rising inequality is the major cause of wage stagnation for workers and of the failure of low- and middle-income families to appropriately benefit from growth
  • Economic policies caused increased inequality of wages and incomes
  • Claims that growing inequality has not hurt middle-income families are flawed
  • Growing income inequality has not been offset by increased mobility
  • Inequalities persist by race and gender
• Economic history and policy as seen from below the top rungs of the wage and income ladder
• The Great Recession: Causes and consequences
  This section contains these charts: 1A
  • A very condensed macroeconomic history of the Great Recession and its aftermath
    This section contains these charts: 1B
• Economic ‘lost decades’: Weak growth for most Americans’ wages and incomes before and likely after the Great Recession
  • Weak labor demand at the heart of the lost decade
    This section contains these charts: 1.1 | 1C
  • Weak labor demand devastates key living standards
    This section contains these charts: 1D
  • Dim growth prospects forecast another lost decade
    This section contains these charts: 1E
  • Two key lessons from the lost decade
    This section contains these charts: 1F
• Extraordinarily unequal growth before the lost decade: Rising inequality blocks income and wage growth from 1979 to 2007
  This section contains these charts: 1G | 1H | 1I | 1J | 1K
  • Income inequality and stagnating living standards
  • Wage inequality and the break between wages and productivity
    This section contains these charts: 1.2 | 1L
  • Strong income and wage growth in the atypical last half of the 1990s
  • Economic mobility has neither caused nor cured the damage done by rising inequality
    This section contains these charts: 1M | 1N
• Today’s private economy: Not performing for middle-income Americans
  • Middle-income growth lags average income growth and historical growth rates
  • Social insurance programs, not private sources, account for the majority of middle-income households’ growth
  • Growing shares of income dedicated to holding families harmless against rising medical costs
  • Households have to work more to achieve income gains
  • Assessing what the private economy is really delivering to middle-income Americans
    This section contains these charts: 1.3
• Today’s economy: Different outcomes by race and gender
  • Many more than just two Americas
    This section contains these charts: 1O | 1P
  • Male and female America
    This section contains these charts: 1.4 | 1.5
  • No one ‘American economy’
• Conclusion: The struggling state of working America is policy-driven
  • The policy good for everybody in the fractured U.S. economy: Ensuring rapid recovery to full employment