Thursday, October 22, 2009

Recession's surprising winners & losers

In the October 21, 2009 Wall Street Journal article "Women's Wages Outpaced Men's During Recession," Sara Murray says "Men are more likely to be unemployed than women — but that's not their only problem."
The wages of the typical woman who had a job during the worst recession in decades rose faster than those of the typical man, new data from the Bureau of Labor Statistics show.

Over the past two years, the wages of the median woman -- at the statistical middle -- rose 3.2% when adjusted for inflation. Wages of the median man rose 2%. Minority men were particularly hard hit, while minority women and highly educated women of all races did better.

The typical full-time female worker earned $657 a week in the third quarter, the BLS said. The typical man earned $812 a week. Men are more likely to be unemployed, though: The male jobless rate is 11%; for women, it's 8.4%

Economists cautioned that the wage numbers and the increases don't reflect the large numbers of workers who aren't working at all.

There were about 8.2 million fewer full-time wage and salary workers in the third quarter than two years ago; the data don't include part-time or self-employed workers. Low-wage workers are hit disproportionally during recessions, and their absence from the tally could cause median wages to rise even if the typical worker isn't getting a raise.

"This is a situation where everyone's losing but men are losing more, and that's not really a victory for women," said Heidi Shierholz of the Economic Policy Institute, a left-leaning Washington, D.C., think tank.

Asian men fared worse than other men, but the median weekly wage for Asian men and women was $877 in the third quarter -- higher than any other ethnic group. Whites were next at $753, then blacks at $607 and Hispanics at $527. The median pay of Asian men declined 4.1% between the third quarter of 2007, just before the recession began, and the third quarter of 2009. The typical black man saw his wages fall 2.8%.

The recession began in December 2007 and most economists believe it ended this past summer. Women's wages have long lagged behind men's, but minority women did much better than their male counterparts during the recession.

Over the past two years, the wages of the typical black male full-time worker fell, but wages rose 7.3% for black women. Among Hispanics, the median male wage rose 0.4% over the past two years, but the median female wage rose 5.5%.

Wages of white and Asian women didn't rise as much as those of other women; the median increased 2.4% and 1.8%, respectively, over the past two years. White males were slightly better off: Their wages rose 2.8%. It was the only ethnic group in which men's wages rose more during the recession than women's; white women's wages rose 2.4%.

"It's risky to make too much of these fluctuations," said David Autor, an economics professor at the Massachusetts Institute of Technology. "That said, male employment has been in relative decline for some time, and I would not be at all surprised that the industries and occupations in which males are most concentrated have been hit relatively hard by the recession."

The pattern of larger gains among some women and minorities isn't likely to hold when the U.S. economy recovers. As jobs return, there will be more low-wage jobs, and that will pull down the median wage. But higher-paying jobs in male-dominated sectors, such as manufacturing, construction and finance, will return as well, and that will boost the median male wage.

Young workers, particularly vulnerable during recessions, were the only age group to see their wages decline over the past two years. Wages for 16- to 19-year-olds fell 0.3% based on numbers that the BLS didn't adjust for inflation. Seniors fared the best: The wage of a typical worker over age 65 rose 15.4% over the two-year period.

Education also was a factor: Those without a high school diploma earned a median of $448 a week in the third quarter, compared to $1,145 for those with at least a bachelor's degree. Pay of women with advanced degrees grew faster than pay of men with advanced degrees. But men still earned more: The highest-paid 10% of male workers with advanced degrees earned $3,260 or more weekly, compared to $2,252 or more for women of the same education level.

Wages of full-time workers in the top 10% grew much faster during the two-year recession (9.5% before adjusting for inflation) than those of workers in the bottom 10% (5.2% before adjusting for inflation).

Write to Sara Murray at

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