Washington, D.C. — A new Center for American Progress analysis finds that not only are Americans’ wages at their peak, but employment is near its all-time high. In February 2020, the United States entered what was by far the largest recession since the Great Depression, with nearly 22 million people losing their jobs and real gross domestic product falling 9.2 percent. Yet, thanks to bipartisan congressional efforts during the Trump administration and the leadership of the Biden-Harris administration, economic growth has outpaced both inflation and the economic growth projections that were made before the COVID-19 pandemic.
Some key takeaways from the analysis include:
- The economy in 2024 is stronger than experts had predicted it would be in 2024 before COVID-19 even happened. On top of this, the economy is stronger than projected to be by 2024 at the beginning of the Biden-Harris administration.
- Wages have outpaced inflation since before the COVID-19 pandemic, meaning that the earning power of households and communities is ahead of where it was before the pandemic.
- After adjusting for inflation, an hour of work earns workers a higher wage than at any point in U.S. history aside from an anomalous period due to compositional effects in the labor force at the onset of the pandemic in February 2020 that created a phantom blip in wages.
- Inflation-adjusted wage growth has been strongest for the lowest-income workers. Wages for lowest-income workers are 16 percent higher than they were pre-pandemic, leading to a significant decline in income inequality.
- Private sector employment of working-age people is at its highest in U.S. history. The share of people ages 25 to 54 with a private sector job is higher than in 2019 and is essentially the highest in U.S. history.
“The Biden-Harris administration has been laser focused on strengthening our economy and their approach is working. The country’s lowest-paid workers’ wages are 16 percent higher than they were pre-pandemic and an hour of work is earning the highest wage it has ever before. The bottom line is that by investing in our economy, Americans’ wages are stronger than they’ve ever been before and our workforce is near an all-time employment high,” said Brendan Duke, senior director of economic policy and co-author of the analysis.
“Because the Biden-Harris administration was committed to full employment, we’ve had the only v-shaped recovery in my entire lifetime—and we came out ahead. Economic growth is beating pre-pandemic projections, employment is near its all-time high, wages are at their all-time high and strongest for low-wage workers, and income inequality is down,” said Bobby Kogan, senior director for federal budget policy and co-author of the analysis.
Read the analysis: “Americans’ Wages Are Higher Than They Have Ever Been, and Employment Is Near Its All-Time High” by Bobby Kogan and Brendan Duke
For more information or to speak with an expert, please contact Sarah Nadeau at [email protected].