Wednesday, April 18, 2018

Earnings Rise, but It Feels Like a Loss

Men without a bachelor's degree earn more than their counterparts did several decades ago, reports Stephen J. Rose of the Urban Institute in a recent analysis. But the rise in their earnings feels like a loss because they are losing ground relative to the rest of the workforce.

Take a look at the growing gap between the earnings of men with and without a bachelor's degree: Men with a bachelor's degree earned 50 percent more than those without a degree in 1980, says Rose. The gap grew to 81 percent by 2000. It climbed to 119 percent in 2015. Ouch. Because the earnings of men without a bachelor's degree are growing much more slowly than the earnings of college graduates, their standard of living is in relative decline.

In the past, says Rose, a middle-class lifestyle was achieved by owning a 1,000 square foot home with a single bathroom. Today, it requires owning "a 2,000 square foot house with air conditioning and multiple bathrooms, bigger and more appliances, TVs, computers, cell phones, and other amenities not available in the past." The earnings of working men without a college education are enough to achieve the modest middle-class lifestyle of yesterday. But they are not enough to achieve the middle-class lifestyle of today. "Plainly, the norms of today's middle-class life...require more money," says Rose.

Source: Urban Institute, Manufacturing and the Economic Position of Men without a College Degree

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