While the last recession officially ended in June 2009, that may come as a surprise to many Americans, who increasingly feel that the American Dream is out of reach.
Almost 6 out of 10 respondents in a CNNMoney Poll said they believe the American dream -- however they wish to define it -- is no longer achievable.
While the American dream may mean different things to different people -- higher wages than their parents, or homeownership, or a healthy bank balance -- the survey is reflecting the lingering impact of the recession: Lagging wages, a tough job market, and greater income inequality. From 2000 to 2013, hourly wages for most Americans either fell or flatlined, according to a new study published today from the liberal-leaning Economic Policy Institute.
"The purchasing power of wages has gone down," Elise Gould, director of health policy research at the EPI and an author of the report, told CBS MoneyWatch. "They've grown slower than inflation," which has caused "terrible stagnation over the last decade."
While the overall economy has grown since the end of the recession, most Americans aren't capturing their share of those gains. In fact, real wages fell for the entire bottom 90 percent of the wage distribution from 2009 through 2013, according to the EPI study, called "Raising America's Pay." The worst-off groups were those at the bottom of the wage distribution, with those in the 20th percentile witnessing their hourly wages slip by 6.4 percent.
But the recession exacerbated a trend that had started decades ago, Gould notes. That's a long-term trend of hourly wages failing to keep pace with productivity. In other words, even though American workers have become more productive since the 1970s, their pay hasn't increased at a commensurate pace.
"Between 1979 and 2013, productivity grew 64.9 percent, while hourly compensation of production and nonsupervisory workers, who comprise 80 percent of the private-sector workforce, grew just 8.2 percent," the report found. "Productivity thus grew eight times faster than typical worker compensation."
College-educated workers aren't immune from lagging wages, either, Gould noted. The study found that entry-level hourly wages fell on average for both male and female college grads since 2000.
"There's a misconception that college wages must have really risen since the college premium has gone up," she noted. "That's not really true; what's happened is the wages of high-school graduates have really fallen, and particularly recently."
For an eye-opening demonstration of how wages have failed to keep pace, the EPI has created a widget that asks you to plug in your current income. It then spits out what your income would have been if wages had kept pace with productivity over the past 30 years. The median American household income of $53,000 translates to $77,000, according to the the EPI widget.
Of course, some workers have benefited in the five years since the recession ended: The top American earners. The highest earning 1 percent of Americans captured 95 percent of the income gains in the first three years after the recession ended, economists Thomas Piketty and Emmanuel Saez reported last year.
Even at the top, incomes are seeing wide disparities, with the EPI finding that the wage gap between the top 1 percent and those in the 90th to 95th percentiles rose faster than any other wage gaps it examined. Because the top 1 percent of earners is dominated by CEOs and executives in the financial sector, the deregulation of the financial industry and corporate governance issues may explain those gains, the paper found.
While the stock market has reached new highs this year, that's also not benefiting all workers, given that only about half of Americans own shares in publicly traded companies.
So what's the solution? Policy changes such as strengthening workers' rights and tweaking the tax and transfer system are among the tools that can be used to bring wage growth back to American workers, Gould notes.
"We should definitely use all of the levers we can," she said.
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