What's Happening To Americans' Income?

Policy Backgrounders | Economy

No. 138
Monday, January 29, 1996
by W. Michael Cox & Beverly J. Fox


Introduction

1April 1995 marked the beginning of the fifth consecutive year of U.S. economic expansion. Gross domestic product (GDP) has grown an average of 3.1 percent annually since the trough of the 1990-91 recession, job growth in 1994 was the highest in a decade, unemployment is hovering around historic lows and the Consumer Price Index through 1995 registered its best five-year performance since the early 1960s.

"Views on the economy contrast so sharply that many people are seeking clarification of the average American worker's prospects."

Despite this good news, media reports often paint a bleak picture of the average American worker's prospects. Such reports cite studies that claim wages and incomes are falling, the pace of economic progress is slower than in the past and not everyone is sharing equally in the economy's gains. In light of these contrasting views on the economy, it is understandable that many people are seeking clarification.


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