American Pie: Families Work Far More Today Than They Did in the 1970s
Stagnant wages and high unemployment tell only part of the story regarding the economic challenges facing Americans. People are also working much more than they did three decades ago to make ends meet, according to a new report from the Brookings Institution:
Although median wages for two-parent families have increased 23 percent since 1975, the evidence suggests that this is not the result of higher wages. Rather, these families are just working more. In 2009, for instance, the typical two-parent family worked 26 percent longer than the typical family in 1975....Median-income families today work an average of 3,500 hours per year, compared to 2,800 hours in 1975 (see chart below; click to expand). That increase mostly reflects the growing number of women entering the workforce. The same trend also largely accounts for gains in household income over that period.
Parent trap
Single parents are putting in even more time on the job. Since the mid-'70s, their annual hours at work have soared a whopping 53 percent. Single-parent households are also earning more. But because there is only a single earner, the median income for such families is only $16,500, or less than a quarter of what the average two-parent family brings home.
That's important because of another major social change affecting how people live -- far fewer men (aged 30-50) are getting married these days. As a result, single-parent families now account for 35 percent of all families with children in the U.S., compared with 17 percent in 1975. With only one breadwinner, such families are of course highly vulnerable to economic shocks, whether losing a job or a sharp decrease in wealth stemming from the housing crash. Brookings concludes:
[T]here is growing evidence that the promise of the American Dream is at risk. This analysis paints a picture of rising family incomes driven largely by an increase in hours worked, particularly among mothers. Increasing labor force participation -- and higher wages -- by working women have contributed more significantly to the rise in family earnings. But this has only helped the typical family tread water; the increased participation by women in the workforce has not overcome the drag caused by the stagnating wages of the typical working man.It's a vital point, and a neglected one in the endless debate over debt ceilings, taxes and government spending. After all, the broader goal is prosperity for all (or as many as full employment allows). And yet in an economy geared to run on personal consumption, there will be prosperity for few if consumers are working ever more for an ever shrinking piece of the dream.
On that note, I think I'll call it a day.
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