Permanent Pay Cuts Are A Fact Of Life For Many

The jobless aren’t the only ones who are suffering during the economic downturn. Many of those who lose their jobs and find new ones take significant pay cuts, with little hope of reclaiming their former income levels.

The Wall Street Journal reports wages have slipped in recent years, and the last time there was such a significant drop was 1981 and 1982. The Journal relays Labor Department figures that found, from 2007 to 2009, 36 percent of those who were laid off from jobs they held for three or more years found new jobs that paid at least 20 percent less.

If you’ve been laid off and found new employment, how does your new paycheck compare to the old one?

Downturn’s Ugly Trademark: Steep, Lasting Drop in Wages [The Wall Street Journal]
(Thanks, Jeffrey!)

Previously: American Pay Dipped 3.2 Percent Last Year

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  1. nbaptist says:

    Hope and Change!

    • PunditGuy says:

      True dat. Give me back those awesome days when we were losing 800K jobs per month.

    • pop top says:

      It’s totally all Obama’s fault because that’s how things work!

    • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

      Obama delivered on his promises, dude. I got change. Pocket change, I hope.

      Buddy, can you spare a dime?

    • tbax929 says:

      I’m doing significantly better than I was when the last guy was president. Does Obama get credit for that?

    • galm666 says:

      You know, because our economy wasn’t in shambles beforehand and as a result (direct or otherwise) of financial policies in place from the 3-4 presidential administrations prior to. No, it just suddenly tanks when someone becomes president and suddenly improves when someone else takes over.

  2. Bativac says:

    I haven’t been laid off but my department has been reclassified as a “call center” and we are taking a net $9,000 pay cut. They announced it right before Christmas. This amounts to anywhere from a 10% to 25% cut depending on how long you’ve been with the company.

    It sucks and I hate it but I can’t find anything with comparable pay and benefits as good as this… though I have a feeling those will be phased out, too.

    • sixsevenco says:

      The more I think about it, trickle-down actually worked. The only problem is that the wealth of the rich trickled down to the absolute lowest salaries. I believe that we are going to see a global re-balancing of wealth. Poorer countries with capable and motivated workforces will see an influx of money and investment. The salaries in the US will continue to decline as we find equilibrium with China, India, etc…

      That is, unless you’re at the top of the food chain, in which case, you’ll be even richer.

      • Total Casual says:

        Neofeudalism, baby!

        • sonneillon says:

          Correct. Trickle down economics and feudalism only helped people as much as the generosity of the group in charge. The only way either side theoretically could work is if no information asymmetry exist and bargaining power between the top and bottom were equal and that is rarely the case.

          • sixsevenco says:

            I think it’s ironic that it was sold as something that would help the American people, but in reality, it helped emerging economies and outside interests instead.

            • kujospam says:

              It helps support the theory of the average American is a moron. I’m with another average of Americans, the lazy. :0P

    • imasqre says:

      I LOST my job. Benefits and all. Since it was a freelance job, and THEY didn’t pay in, I’m not even eligible for unemployment. I went from over 30k to nothing in a couple of months.
      Been applying to retail and even fast food. Can’t find anything for the last 3 months. I’m absolutely shocked.
      Food stamps and Gen. Assistance next week. yipee.
      PS: and I have a damn master’s degree LOL

      • richcreamerybutter says:

        Which state? I know in New York they’ve been cracking down on employers who try to classify employees as “freelancers.” Basically anyone who is required to be on a job site can be eligible for unemployment, regardless of how the employer was trying to pay you. Other criteria include: using employer equipment, a schedule determined by the employer (as opposed to setting your own hours), and answering to a superior.

        If I was in your shoes, I’d check in again with a Dept of Labor representative to see if the laws in your state have changed, unless you know for a fact they haven’t.

  3. Urgleglurk says:

    Not the President’s fault, nbaptist. You really think he tells businesses what to pay their employees?

    • The cake is a lie! says:

      In a sense he does. As the President he has a responsibility for the economy that he is fucking over with every step he takes.

      • Don't_rip_me_off_bro says:

        /failhorns

      • stock2mal says:

        Umm, no. The president has very little influence over the economy.

        • nbs2 says:

          I’d beg to differ. He may not have a significant influence over microeconomic transactions, but the Cheney administration set up and created this disaster, the Bush administration undershot in mishandling the aftermath, and the Obama administration overshot in mishandling the mess it was left with.

      • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

        Complete and total ignorance about how the world works.

      • Cosmo_Kramer says:

        Woah there slugger, the economy was fucked on the last guy’s watch, Obama is just doing what he can to save it. I don’t know how you can blame him for the state of the economy.

        • AustinTXProgrammer says:

          It was messed up when he got it, we borrowed and inflated our way out and then the debts became due.

          To me it was the dot com boom, and we are still adjusting. I don’t think we can blame this on any single administration.

          • nova3930 says:

            No but we can lay a lot of blame on the congress critters like Barney Frank and Chris Dodd monkeying with the mortgage markets…..

            • PunditGuy says:

              What monkeying would that be? Be specific, now.

            • bite back says:

              wrong politicians to blame. look to McCain’s presidential campaign financial adviser and former senator from Texas Phil Gramm. it was he that pushed legislation to create hedge funds with the freedom of any regulatory oversight. it was he that pushed legislation that allowed Enron, where his wife worked after being secretary of Labor, to do their dirty, destructive deeds. it was he that joined that criminal money laundering concern UBS Warburg as vice chairman advising clients on corporate finance issues and strategy. it was he that told you back in 2008 as the economy was imploding that you were suffering from a mental recession.
              http://www.washingtontimes.com/news/2008/jul/09/mccain-adviser-addresses-mental-recession/

              • Bsamm09 says:

                Why should hedge funds be regulated? They are extremely private ventures.

                • bite back says:

                  Using hedge funds to gamble is OK for the very well heeled, but when public funds (government, pension funds) invest in hedge funds and managed accounts then there is unacceptable risk IMHO.

      • FrugalFreak says:

        yeah be he is trying to wipe the poo off his shoe from previous administrations while moving foward.

    • zzyzzx says:

      No, but he can make it so expensive to have workers in the US that companies will move more jobs overseas, which causes more unemployment here, which causes wage cuts in the US.

      • stock2mal says:

        LMFAO, I love Latrell Sprewell reasoning. “I gots kids to feed, I might as well shut down and not do anything.”

      • jebarringer says:

        Because no one ever moved jobs overseas before Obama go into office…

      • JulesNoctambule says:

        Yeah, Americans are too expensive to employ these days! That’s totally the reason corporations have been moving jobs overseas. . .ever since I was a kid. How they expect us to be able to buy their imported sweatshop goods without jobs to provide the money isn’t mentioned, though.

        • th3v6cann3val0s3 says:

          Us? Ha. The wealth has already been extracted.

          There’s still middle classes on this planet with enough discretionary income; the sad part it isn’t in the United States anymore.

      • Awesome McAwesomeness says:

        Who is he? We don’t have a dictatorial government. We have a Representative government where a large group of people WE elected make the decisions. It’s not one person doing it. It’s a huge group doing it.

      • spazztastic says:

        Which started when NIXON was president, not Obama.

      • FrugalFreak says:

        And they should impose a 20% tax for every ten jobs shipped overseas. If you sell to Americans to take thier money, you should be forced to hire Americans from wence you’ve taken.

    • not-gonna-tell-ya says:

      well, by supporting certain policies, yes, yes he does. support univ. healthcare?(as just a single example) Guess what? You has a business owner has to 1) spend more money just reporting your finances, and 2) spend more money per employee on minimum coverage levels. That money has to come from somewhere if they don’t want to take a bath personally, either off the backs of their employees, or off the backs of their customers. At this point in time it seems to be both

      • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

        Sorry, this whole nightmare was set in motion before Obama was even not born in Hawaii.

        • not-gonna-tell-ya says:

          nice shift. Typical. Someone makes a point, and you rebutt by an answer that doesn’t address the point, but motions to something completely unreleated.

          I’ll agree that previous policies from at least 10 past administrations have lead to the problems we are seeing now. I’ll even bite and admit that I don’t give a fuck where the President was born.

          • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

            Sorry, I’m a little bit snarky., and its just a little sarcastic jab at all those that say it’s Obamas fault… especially those that are so deluded as to not think he is a citizen by birth. Get it?

      • LadyTL says:

        He isn’t supporting universal health care. If he was we would be going to a Canada-style health care where the majority of the costs are on all taxpayers not businesses.

        • not-gonna-tell-ya says:

          If you think business pays taxes from their unicorn acount I have a bridge to sell you. The money that ALL taxes business pays comes directly from the consumer and the depressed amount they pay their employees

        • not-gonna-tell-ya says:

          That’s what was tried. The ‘compromise’ amongst the left/right democrats was that they would start with exchanges.

      • th3v6cann3val0s3 says:

        Right, but the part that kinda kills your argument is that businesses are ALREADY paying (some say too much) for their employee’s healthcare, both directly and indirectly.

      • dolemite says:

        A lot of small business owners aren’t “struggling” as repubs would have you believe. A great many have made out like bandits over the past few years, but love to cite “the economy” as a reason to work people longer, pay them less, and cut benefits all while their coffers fill up. The government hasn’t been blind to the fact the rich have gotten richer while the poor got poorer. In the next 20 years, NO ONE will be able to afford healthcare unless we have some radical changes. I mean..do the math. Wages have been stagnant for years (and will be for the near future), but healthcare goes up 5, 10, 20% per year. Who’s going to be able to afford it when it is 300 or 500% more expensive?

        • FrugalFreak says:

          +1

          If they aren’t having a windfall, they are struggling. They need to go a year with no money to see what struggling is. It is not just the loss of some of your profits to pay for that Lexus.

        • Papa Bear says:

          Small business owners themselves may not be struggling, but many small businesses are. How is this logical? The modern small business owner does not understand how business ownership works and along with paying him or her self an exorbitant wage in relation to gross profits, he also does not reinvest the net into the business. Hence, while the business owner temporarily lives high on the hog, so to speak, the business struggles. The owner then uses the struggling business excuse and cuts wages and benefits.

          I read a survey which indicated that the average small business owner paid his self a salary equivalent to @ 33% of the company’s gross. With the average hourly labor rate eating up another 20 to 25% of the gross, what is left after overhead to build the the business?

    • tbax929 says:

      How dare you bring logic into a debate with someone who can’t see past political parties when discussing an issue.

      I spent my evening last night at the memorial service for our victims and survivors here in Tucson, and it disgusts me that we’re still fighting about issues from a partisan point of view.

      How about we get past worrying about whose “fault” it is and start working together to fix this mess?

      • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

        “How about we get past worrying about whose “fault” it is and start working together to fix this mess?”

        THIS.

        On a side note, I don’t care what your political leanings are, I watched part of the memorial last night. Say what you want about Obama, but the man is one hell of an orator. If we could harness some of that talent to bring people together, we could be out of this mess a hell of a lot faster that the current finger pointing, cronyism, and inaction will.

        //rant

        • tbax929 says:

          His speech last night was amazing. When he mentioned that Gabby had opened her eyes, it was like a force went through the stadium (I couldn’t get into the arena, so I was with the overflow crowd at the stadium).

          Of course, then I went home and got to see the talking heads criticizing him for “grandstanding”. So the message didn’t get through, I guess.

          • yessongs says:

            Obama is an idiot, I’m glad I didn’t vote for him. He has done nothing for me at all. I was unemployed when he took office and I still am. His economic plans are a joke I see no new jobs created from them. He needs to be run out of town on a rail!

      • Kibit says:

        Agreed! We have to start working together to fix this mess. Arguing and pointing figures at opposing political parties isn’t going to fix anything.

    • Applekid ┬──┬ ノ( ã‚œ-゜ノ) says:

      Just gotta say that politicians just wind up begging for this kind of criticism by campaigning on promises they can fix things.

      If you promise the world, you’d better be able to deliver.

      I would love, just once, for a candidate speak frankly on the campaign trail that the President doesn’t really have too much say over what happens to the economy.

      I would also like a pony.

      • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

        Here we’ve had many cases of “Ponies” being given away or abandoned because owners don’t have the money to feed and care for them. People go to bed with 2 horses and wake up to find 5 in their corral. Talk about a “gift horse”!

        If they had their thinking caps on they’d sell their truck to pay for feed and drive the horse. The Amish may not be as crazy as you think ;) Of course, these are the same people who load their horse in a trailer and drive their F450 5 to 50 miles down the road to ride them around in circles.

      • muralivp says:

        They might as well just give up their candidacy

    • jacobs cows says:

      He keeps negotiating more free trade agreements and wont limit immigration so we have more work leaving the country and at the same time more workers entering the country.

  4. Nigerian prince looking for business partner says:

    I suspect that the numbers are significantly worse when you factor in people who are earning the same wages as 2010 but paying significantly more for health insurance. My company had a blanket “no pay raises” policy in place for 2010, while health insurance premiums went up 19% and at the same time not even offering dental or vision. This meant a very steep decline in the take home pay for just about everyone on payroll.

    We also have a lot of people working 50+ hours to make up for the laid off employees but still earning a salary based on 40.

    • zzyzzx says:

      It’s not just the health insurance that costs more!

      • Nigerian prince looking for business partner says:

        Yeah, it’s amazing how inflation is technically at 0% but the cost of every utility and health insurance is going up over 10%.

    • UltimateOutsider says:

      Yep. I got no raise in 2009, only a 2% raise in 2010, but all of our insurance costs have gone up steadily, along with utilities and groceries. Of course our property taxes keep going up even though the assessed home value has gone down. You don’t need a pay cut to be losing ground these days. You need significant raises just to keep up.

      Oh yeah, and I just learned my cable company’s about to raise rates by 50%- this after I dropped the other local cable company for being too expensive.

      • mianne prays her parents outlive the TSA says:

        You have more than one local cable company? Consider yourself in the very lucky, and very small minority.

    • dolemite says:

      Not just health insurance. ALL of my bills have gone up at least 5-10%, even when you don’t take health care into account. I think I got a 1% pay increase over the past 2 years. My hours went up about 10-15% in the same time (salary), so depending on how you look at it, I’m making about 15-30% less now than I was 2-3 years ago.

      And what sucks is I was kind of hoping the 2% cut in FICA would help out a little, and I got my first paycheck. I was expecting a $30 increase (yeah, I know, not much, but at least something), but instead got $9.50. I asked our accountant why so little, and she said she had to adjust the federal taxes too. So those went up like $20 a paycheck when FICA went down $30.

      • Nigerian prince looking for business partner says:

        I think most of us are in the same boat. I haven’t seen my first paycheck for the year yet but I think it will be the same as yours — The 2% cut in FICA is replacing the Making Work Pay tax credit, which amounts to $800 for a married couple. If I’m doing the math correctly, I should be making an extra $70/month more than I did in 2010, not factoring in the $200 increase in health insurance premiums.

        • MrEvil says:

          I’m in the same boat as you folks, the reduction in FICA and my 2.8% pay raise didn’t net me much extra take-home pay.

    • jesusofcool says:

      I agree with this. This number is way higher if you factor in companies that have completely stopped raises although the cost of living – and of health care – continues to rise.
      Also factor in companies which haven’t laid off anyone but aren’t hiring replacements for those who leave/retire or are slow to hire replacements, forcing current employees to work increased hours for the same rate of pay.

  5. Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

    … Or if not outright pay cuts, then wage freezes, hour reductions, and PTO / benefit reductions or elimination.

    And don’t forget you’ll pay a larger percentage of your health insurance, to go nicely with the higher premiums and reduced benefits – unless, of course, you are one of the priveleged class. ( YEAH, I’m looking at YOU, CEO’s and Government employees / officials!)

    • danic512 says:

      Uh, plenty of government employees are paying higher rates on their healthcare, both in absolute and percentage terms. What the heck are you on?

      • Nigerian prince looking for business partner says:

        I would absolutely kill to have even the worst civil service health insurance policy in my state. As much as they complain, it’s not even in the same universe as a typical policy offered by a small business where I am. State employees were threatening to strike when it was proposed that their premiums would go up to $250/month for a fairly decent PPO.

        • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

          Yep, thats half what I pay for crappy insurance. And yea, I’d love to see our workers go on strike. The company would fold at this point in the economy, even if they didn’t just fire us all. Ah, the joys of living in a “right to work” state.

          • Nigerian prince looking for business partner says:

            I can definitely commiserate. I pay close to $1,100/month for a high deductible plan for my family.

          • brinks says:

            My current job offers halfway decent health coverage at a good price, but their hourly wages are so low I think I’m going to choose to go without. I’ve been without since losing a previous job in April.

            I sympathize, though. I saw so much of my paycheck at that job go right out the window for a healthcare plan that didn’t cover s***. Even after the large payroll deduction and $25 to $50 co-pay, I still got bills. I have no idea what I was paying for.

      • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

        Obviously, I’m on a drug that my health care plan doesn’t cover. I’m sure yours does. Sorry, I don’t have any sympathy until 23 percent of your pre-tax income goes to crappy health insurance like mine does. If your insurance costs are increasing, it’s still going to take a long time before you catch up to the rest of the country.

        • Erika'sPowerMinute says:

          I’m sorry that you or anyone is paying through the nose for crappy health insurance, but that doesn’t make it any less sucky that, as a federal employee, my husband just got the pay/bonus freeze notification, and our health premiums/copays are indeed going up year after year while our coverage goes down. I know I have it better than many people and for that I’m grateful–but it still means we have less disposable income to put back into the economy. We especially try to support small, local businesses (many of which in our area have closed due to big chains and the economy both) but when we have fewer dollars to spread around–bad news for everyone.

          • Nigerian prince looking for business partner says:

            “and our health premiums/copays are indeed going up year after year while our coverage goes down”

            Just to put in perspective, how much per month do you pay for your portion of the premium and what is your deductible and type of plan?

  6. Mom says:

    When I got laid off 5 1/2 years ago, I found a new job right away, but took a 20% pay cut. I’m still making less than I made back then. When you add in the increased health insurance costs and the fact that I get about half the vacation time at this company after 5 years that I got at the last company after 2, I won’t be catching up for awhile. When you add in inflation, I’m not sure I’ll ever make as much in real terms as I did from 2000-2005.

    • Nigerian prince looking for business partner says:

      It’s really depressing when you look at it that way but I think a lot of us are in the same situation. I’m making significantly more money than I did back in ’99 but at that point, my employer paid 100% of my health insurance premium and my deductible was around $250 with $5 copays. Outside of the government, I don’t think anyone has a plan like that anymore.

      • Erika'sPowerMinute says:

        My husband works for the feds and we have a $500/person deductible, $30 copays and the premiums are about $500/month. Just correcting any possible assumption that everyone on the government teat is getting a free-ish ride.

        • Nigerian prince looking for business partner says:

          $500/month for a family PPO with only a $500 deductible is a bargain!

          I pay $1,100 month and have a HDHP with a $5,000 ($2,500/person) deductible. There aren’t any copays because insurance only kicks in after the deductible is met. I know several people who pay even more than I do or the same amount and have lower tier insurance.

          • Erika'sPowerMinute says:

            You will notice that I have acknowledged that other people pay more, in many cases much more, and that I am fortunate to have what I have.

            However, that is incidental to the point, being that: as our medical costs rise dramatically, we have less money to put back into the economy.

  7. Terence says:

    I moved, and took a 40k pay cut. I’m living in a much cheaper area, though. Depending on which online calculator you believe, the 140k I made in state A is equal to 112 in state B.

    And at my new job I have much more spare time and can do freelance work at home. My standard of living may even improve. (I was doing freelance in addition to my old job too)

  8. Don't_rip_me_off_bro says:

    This is misleading because we are actually gaining. Data shows that CEOs only made 263 times what the average worker does in 2009 down from 319 times in 2008.

    Woo.

  9. bite back says:

    It is a race to the bottom. Our trade policies have led to the United States losing approximately 42,400 factories since 2001. The deindustrialization of this country is hollowing out our middle class. Welcome to the neo-feudalism where scores of serfs are being created every day.

    http://www.businessinsider.com/deindustrialization-factory-closing-2010-9?slop=1#slideshow-start

  10. pecan 3.14159265 says:

    Knock on wood, we have been a lot more fortunate than others. We make more money than we used to, we have jobs we like much more than our previous ones, and whether or not we left by choice, things have worked out for us. Most of our friends are also stable and the ones who aren’t at least have savings.

  11. skwigger says:

    I was laid off back in March 2009. I found new employment relatively quickly, and am make about 50% more now. My situation is not the norm.

  12. carlathecommander says:

    My check is less now, but I believe I was overpaid at the last company (which is probably why they laid a lot of us off).

  13. Qantaqa says:

    See, this is the problem that people aren’t really talking about; it’s not just the unemployment rates but the *underemployment* rates that are really an indicator of the country’s economic health. It’s kind of frustrating to have a job (with benefits thank god) but still not being able to make ends meet.

    And before you ask, I don’t deem food and shelter to be living “beyond your means.”

    • ndonahue says:

      I agree with your point about underemployment.

      I’d like to add in the concept of “overemployment”, where people are paid artificially high wages. This can happen for a whole lot of reasons: historically low unemployment leading to competition for workers, boom cycles of substantial corporate wealth, unions, long tenure in a given job, etc.)

      It is inevitable that societies/economies cycle through phases of boom/bust, bulls/bears, growth/decline, etc. We’re on the down side right now and it hurts more than it hurt our parents or grand parents because we artificially inflated the boom cycle through increased personal debt.

      So people are worth more or less at different periods of time. Businesses are very good at assessing value quickly, whereas people cling to the belief that they’re always as smart as their best test, as valuable as their highest salary, or as fast as their personal best. We’d all help things improve more rapidly if we disabused ourselves of that idea.

      I am not worth the obscene salary and unbelievable stock grants and options I earned 10 years ago. The incredibly beautiful, powerful, and hand built car I bought in 2000 to celebrate a really big bonus is on its very last legs, and I don’t believe the world owes me another one. I’m thinking of a Prius…

      • Qantaqa says:

        This. I know more than a few recent college grads getting 70 k a year starting salary. I don’t even know what I would do with 100 k a year. Buy an emu farm maybe?

        I think American culture is focused on the idea of higher salary = more successful = better citizen and all-around human being. I especially noticed this in the comments on the “best and worst jobs” post a day or so ago. Everyone was equating good job = making more money, not really commenting on the job itself and what it would entail.

        I would be ecstatically happy with 40 k, and I’d be ok with 35 k simply because they would support a decent lifestyle, i.e. enough food, shelter, transportation and a comfort/luxury here and there. However, I think the “pull-yourself-up-by-your-bootstraps” mentality inherent in American culture makes it difficult not to equate lavish lifestyle with success. Thanks Andrew Carnegie.

        • tooluser says:

          Nope. “Underemployment” is talked about constantly by the media, so it’s certainly not an undiscussed subject.

          But underemployment is not and never has been a problem. Do you really think that the 85%+ of early American colonists were ideally suited to be farmers? Of course not. But they built a country nonetheless. Which makes them different from many people living in America today.

          They were not whiners. Underemployed is by no means unemployed. I am aghast that many states pay unemployment benefits to anyone who does not work 40 hours per week. If you work even 1 hour a week for money, you are, by definition, employed. The statistics are largely accurate, but they don’t report what you would like to hear.

        • Nigerian prince looking for business partner says:

          “I would be ecstatically happy with 40 k, and I’d be ok with 35 k simply because they would support a decent lifestyle, i.e. enough food, shelter, transportation and a comfort/luxury here and there.”

          When the average family health insurance policy runs $15,000 and goes up over 10% a year, $35k salary really doesn’t go very far.

  14. eligiblebachelor says:

    I just want a full time gig. I’d even take a contract. I’ve been laid off almost 2 years, and I have an Associates degree. Plus I completed my BBA while laid off, now I’m overqualified for many jobs because I have work experience.

    I’ve talked to recruiters at Fortune 500 companies and the majority have hiring freezes in place.

    • tbax929 says:

      Maybe you’re looking in the wrong field. My employer is hiring, and has been hiring for years. When I went to our orientation there were over 30 people there with me, and we hold orientations every couple of months.

    • Snoofin says:

      Youre the kind of person that causes these numbers to be so high. God forbid if you apply for a position at a company that isnt Fortune 500. You could easily take a job making 30 or 40k in a warehouse somewhere but you find that to be beneath you and unworthy of your application because you got a “college degree” and that automatically makes you have to earn at least 100k in the field you studied in and in a major company. You people can boo hoo and cry when your laid off from your 30k/year job. Until then stop whining!!

      • Applekid ┬──┬ ノ( ã‚œ-゜ノ) says:

        And I’d argue that a college graduate working a warehouse job or similar other unskilled job is taking a way a job from someone who genuinely doesn’t have skills. Gotta make ends meet, sure, and it’s every man for himself out there, but there are big picture implications.

        Someone skilled in a valuable field is of most value to society when they’re working that field.

        Kind of reminds me about that Y2K Family Guy episode where the world goes to pot and Peter founds a town. They get a former doctor who has to draw his job out from a hat instead of just bein’ a doctor.

      • Kibit says:

        It doesn’t sound like he’s whining, he’s just frustrated like everyone else. He also never said he turned down $30-$40,000 a year jobs. Its highly possible he hasn’t been offered any jobs. Unfortunately stories like hi are all too common these days.

        • Snoofin says:

          He sounds like someone who wouldnt even apply for a job if it doesn’t pay the big bucks but even if that isn’t the case, a large amount of people sucking the unemployment teat, continue to do so because they refuse to take a job that pays less than the one they last had. They could put forth some effort and works 2 jobs like Ive done many times instead of sitting on the couch sucking my tax money up.

          • Dollie says:

            Way to assume there. There are a lot of us in the same boat, but I guess we weren’t lucky enough to catch YOUR boat.

            People turning down jobs because the job is beneath them? Is that why I’m seeing older cashiers, hearing deeper voices in the drive thrus, and helping the delivery driver up the steps with his cane when he brings my pizza?

            Do you want fries with that? Cheese no longer comes with the whine.

  15. SPOON - now with Forkin attitude says:

    about 40% less.

  16. ReaperRob says:

    I’m making 7% less per hour, but working only about half as many hours a week.

  17. DriverB says:

    Everyone at my small company was given 10% paycuts early in November, and we’re now paying more for health insurance as well. :( I guess I’m grateful to still have a job, but I moved and took a paycut to come here – and I don’t see any changes being made to how we do business to keep this from happening again.

  18. Chris W. says:

    I was RIF’d in 2003 along with a few thousand others in my business entity following the riffles of 9/11 as they eventually hit the telecom industry (I was there ten years). It certainly threw me for a loop financially, emotionally, and otherwise.

    Over the next two years I did some “consulting” to no real tangible outcome and lived off my severence. Eventually, I decided that I start completely over-career, position, type of employment and most certainly pay (which was about half..no, more than half what I had been making before).

    And while I can’t say I particularly enjoy my job that I’ve been in since, it’s stable and decent, and shoot, I have a job and that’s something these days. My salary has crept back up too, though I’ll never make that much again.

    And you know that’s okay-I don’t want to work those 50, 60, 70 hour weeks I had to back then with all the associated stress. I’m much more content now to have a modest income but more quality time that I can now devote to my family.

    So, lemons, meet lemonade. And I’m grateful for ‘em.

  19. RickinStHelen says:

    Part of this is the buggy whip comparison. It doesn’t matter if you are the world’s best buggy whip maker, if the world doesn’t need buggy whips. Conversely, if you are a high quality buggy whip craftsman, but people can hire someone who makes an adequate buggy whip for less, out you’ll go. Things change; you must adapt or die (metaphorically speaking).

  20. topgun says:

    I would like some input on this from the readers.
    I have servers & bartenders that all make minimum wage or above. Because of that they are obligated to report tips. I doubt any of them do.
    My accountant says I should reduce their pay to $4.25 an hour and report a tip income of $3 per hour for them to bring them up to $7.25. First please keep in mind these people make killer tips. To be honest my employees make more per year right now than I do. I’ve run this past several who have no problem with it because again, they make great tips.
    Here’s my dilemma. I suspect some will balk. I’m afraid some will say it is unfair to take a pay cut. I want to be fair, but in these economic times I need to make cuts in expenses just so they have jobs period.
    Am I right or wrong to ask them to take pay cuts?

    • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

      sure. you can ask, but when they walk over to the bar down the street and leave you shorthanded, and you have to hire new bartenders who may or may not work out, remember who told you so.

      • th3v6cann3val0s3 says:

        It would probably be safe to say if he/she is reporting these type of conditions, similar establishments that would hire his/her turnover would also find themselves in the same conundrum. If your strawman argument stands then effectively those employees will never stop looking for ‘correct’ compensation.

        Either way, Original Commenter: listen to your first replier; please do not neglect to realize your exposure if you were to put such a pay system in place.

        • Cheap Sniveler: Sponsored by JustAnswer.comâ„¢ says:

          They may not leave right now while conditions are bad – but they will not forget when conditons improve.

          I guess the questions are, how many will leave, how easy are they to replace, and what will it be like after the economy recovers – will your remaining employees remember, and will they hold it against you?

    • Verdant Pine Trees says:

      It sounds like you need to focus your explanation on that last part – that you are lowering pay so that everyone can keep working.

      If you explain that you have to make a choice between literally firing some people, and cutting back the income everyone makes slightly, people will probably be OK with it.

      You could also cut some people’s hours or incomes based on their efficiency, but in the long run (thanks Jack Welch) this only creates a hostile workplace where people are busy elbowing each other.

      Most people would rather that they earn a little less, than be worried that they or a friend’s job will be on the chopping block. Those that are really huffy about this (i.e. only caring about themselves and not the long-term viability of your business), you might want to consider what kind of employee they are in other respects.

      You say they’re making more than you do, too, so don’t feel guilty.

    • ndonahue says:

      This isn’t an ethical question. I don’t know your state, but from a Federal perspective, your employees obligated to report tip income regardless of base pay.

      If you drop their wages and report tips of $3/hour while knowing that their tip income is significantly higher than that amount, you are in violation. Don’t expose yourself to liability that creates no real reward for you.

      You need to get yourself a better accountant. Seriously, you run a substantially cash business. There are a million ways you can skirt the line between tax avoidance and tax evasion that are much harder to prove, and your accountant is proposing something that is easily proven false and creates no real benefit for you (the business)… Get a better accountant.

      FYI — when you are audited, they’ll get you by looking at three numbers: revenue, labor costs, and reported tips. If you’re honest, those three will have a high degree of correlation. You’ll be screwed because tips and labor will correlate 100%, and tips to revenue will have no (or much lower) r-squared.

      • Papa Bear says:

        Actually, he is not in violation of anything. The min. wage law allows for servers to be paid a different minimum wage as long as the employer reports the difference between the server minimum and the standard min. wage on the employees W-2 statement.

        What isn’t clear is if the employer must also report that difference regardless of the wage being paid servers. At one time, in Wisconsin where I live, as far as state taxes went, he had to. I can’t see that having been changed because what gov’t is going to give up tax dollars? I truly believe if on the W-2, the employee is listed as having a job which is considered a server’s position, that technically, the difference between server minimum and standard minimum must be reported as tips on the W-2.

    • Papa Bear says:

      Yes! Absolutely do this if you don’t want to lose these people. I think, however, that you still should report $X for tips if they are working as servers no matter what you pay them. I’m pretty sure that is still the law for servers. I’m not sure, but back in the ’80s when I was still in the restaurant biz, that’s what it was. You may want to check that out. Simply because a server makes more than server min. does not me the employer can stop reporting a portion of their tips.

      • tooluser says:

        It’s not his job to enforce tax reporting by his employees.

        An employer should pay what he can afford to the employees. If he can’t afford minimum wage then he is doing it wrong, and should go out of business if he needs employees to operate the business. That’s the minimum standard, he can do no less.

        And the employees should not work there if they are unhappy. No excuses on that end either.

    • golddog says:

      You didn’t say what area you’re in, but minimum wage for servers is low precisely b/c of tips. It’s not your responsibility to verify what they report, but the owner usually reports on the W-3 what they report. In my past gigs, servers were usually “encouraged” to average at least 8% of their total sales.

      Not sure why you started paying more than the norm, but here’s what you’ll gain by taking your accountants advice. You’ll pay less FICA, SS, UI, and Worker’s Comp (approx 9-11% of your gross payroll depending on how broke your state is). Your employees will pay less income tax (although there’s more credit cards and less cash than there used to be). Bartenders are a little different in that they usually have a higher hourly so you may have to structure them differently.

      You hit the nail on the head though. You have to make changes or they won’t have jobs at all. If they don’t want to play ball, I bet there’s people willing to take their place.

      • golddog says:

        As others pointed out, the IRS expects servers to report all their tips regardless of what their base was (unless they didn’t meet minimum wage). The 8% thing was what corporate considered to be the threshold that would keep the IRS happy and just assuming your waiters were really crappy. If you go w/your $3/hr plan and your reported tips don’t equal over 8% (or more) of your receipts, expect an audit.

  21. mbgrabbe says:

    Sadly I think this means the minimum wage in this country needs to be lowered. The economy is too crippled right now to employ throngs of people at the federal minimum of $7.25/hr. If we temporarily lower that down to $5.15 (where it was pre-recession), I think it’d really help people get employed and get the economy moving again.

    • eirrom says:

      You do realize that $5.15 x 40hrs/wk = $10,712 before taxes. How is that “income” going to “get the economy moving?” How does $7.25/hr do it either?

      Our economy is consumer based. If you have money to buy something, you often will do so. That item needs to be sold to you, shipped to to the store to sell to you, manufactured so it could be sold to you, etc. If the people who sold the product, shipped the product and manufactured the product pay a good wage, the cycle continues and people will buy the next item and so on and so on. That is how we grow the economy. People need money to buy products, businesses need money to make the products. Once this cycle gets going, business add employees (hopefully in the USA) since they are making more money. These employed people start to buy things since they have extra disposible income and cycle continues.

      • mbgrabbe says:

        Ya I know, I see what you’re saying, but $10,712/yr is still greater than $0/yr. And plenty of people are making $0 a year (or living off unemployment/welfare).

        And your logic of how the economy works is correct, but its also true that if you introduce lower paid workers into the supply chain, it could actually lower the shelf price of an item, which everyone would benefit from.

        • Nigerian prince looking for business partner says:

          I suspect reducing the minimum wage would have the unintended consequence of making even more people eligible for government programs and would still end up costing our overall economy the same amount. It would amount to the government subsidizing the low wages even more.

          • catnapped says:

            Why do you think Republican governors are feverishly dismantling the safety nets? Give the unwashed no choice but to slave at those minimum wage jobs (which in their opinion, still pay way too much) and be indebted to the nobility forever.

        • dolemite says:

          At $10,000 a year busting your ass, are you going to go out and find a job, or sit on your ass and collect welfare? If it were me…I’d sit on my ass.

          $10,000 isn’t even enough to cover rent anywhere, much less to provide for a family. You’d have to have like 2-3 people in the household working 2 jobs to make that work.

        • amgriffin says:

          Until the manufacturer decided that they could increase their profits by keeping the cost of the things they sell the same and pocketing the monies that used to go to payroll. That’s how it really works. Savings don’t get passed on, that’s why so many companies are making record profits.

        • Mom says:

          But you eliminate the people who are able to buy the item. Net fail.

    • shadowhh says:

      WHAT? Thats crazy talk. Remember Raising the minimum wage would not cause anyone to lose there jobs.

    • PunditGuy says:

      The cost of hiring people is not the issue. Demand is the issue. This is why tax cuts aren’t the solution — corporations are already sitting on a crap ton of cash. They just can’t foresee high enough demand for what they sell in order to justify adding more bodies. The $4K or so annual marginal cost per employee that you’re trying to save businesses isn’t going to be the answer.

    • evnmorlo says:

      Done. $7.15 in 2011 dollars is worth about $5.15 in pre-recession currency.

  22. dvdchris says:

    I feel this article. Job position eliminated; at least I was given another position but at a 35% paycut. Looking for something else, but not finding much thats better than what I have now.
    I have started to radically downsize my life and plan on moving into a small travel trailer by the end of the year.

  23. moonjest says:

    This isn’t surprising if you think about jobs in terms of demand. As our economy changes, so will the needed skills and professions. People need to flexible enough to adapt. If the majority of the people in this study found jobs that were outside their area of expertise (which may or may not be in demand anymore), then I would fully expect them to take a pay cut as they start a new job at a new company.

    People talk about underemployment, but I think that is a misleading figure. If a person majors in Philosophy or Art History (just for example) and expects to have a job paying >$40,000 upon graduation but finds that he can only get $10/hr jobs, does that mean he is underemployed?

    If a person is laid off or fired from a job paying $20/hr because the quality of his work – or his work ethic – wasn’t up to par, is he underemployed if the next job he gets pays $14/hr (cause he wasn’t able to get a job using his previous employer as a reference)?

  24. Torchwood says:

    All together now… “More work, same pay, no bonus, no raise. Thank goodness I have a job.”

    And what incentives do employers have in hiring people? None. My bosses would even like to get a few more people in our department, only to be told “No!” by upper management.

    It’s a employers market out there. And the employers aren’t opening the purse strings.

  25. smbizowner says:

    pay cut 35% less and also paying more for insurance and commuting farther so expenses are up.

    but here in Michigan, happy to have a job – and our hemorrhaging started under the previous administration, so can’t blame Pres O.

    5 years ago a buddy made an observation. The middle class in countries like India are thrilled to make $12g/year. If all middle class wages start to average out world wide, the American paycheck is going to sink pay wise A LOT. We’re going to be eating a lot of beans and rice…..

    • Nigerian prince looking for business partner says:

      It’s inevitable that in a global economy, there will eventually be an equilibrium reached as the standard of living drops in richer nations and rises in the poorer ones. It’s really only a matter of time until the US economy begins to contract from outsourcing and from declining population. Unless things drastically change, we will never see the Post-WWII prosperity again in the western world.

  26. aja175 says:

    I guess I’m in the minority here, but when I was let go from a bank job I picked up a job in the same field but not specifically a bank pretty quick and am making $20k more than I was before.

  27. Pam in Oregon says:

    My husband, who is finally working again, took a 40% pay cut and has no benefits of any kind. We are glad he is working, but it is unlikely he will ever be back to where he was before the economy tanked.

  28. Halliday says:

    Last year I had to agree to a 5% pay cut or be fired. There have people that have been hired since then that have no idea what they’re missing.

  29. Awesome McAwesomeness says:

    How about people like my friend who were not only given pay cuts, but the work of another person who was laid off. Then, their company is still making record profits?

  30. dolemite says:

    You know, I wouldn’t mind paycuts if it meant working less. For instance, if I could take a 15-20% paycut at work now and work 15-20% less hours, I’d do it.

    Instead, everyone is taking permanent paycuts and working permanent long hours.

  31. areaman says:

    Another great article from the WSJ. According to the article Maria Gregg (the auto worker in California) use to make $1200 a week (or $62400 a year) without a two or four year college degree. And people are surprised what wages are dropping.

    Factor in hysteresis and drop in demand… this is the new normal.

    • nbaptist says:

      In 1998 while working as a contract engineer a Boeing Seattle. I was working nights on the 777 we use to see a young guy walk by in a suit and tie.

      A few weeks later he walked by without the suit coat but still white shirt and tie!

      After that he lost the the tie, then was wearing a t-shirt and jeans.

      I stopped him one day and asked what happened to the suits he use to wear. His reply was that his position was working in the Executive Offices and the suit was required!

      I asked what he did, “Empty the waste baskets” was the reply!

      He was in the union and was voting to go out on strike as $60K a year wasn’t enough pay!

  32. NotEd says:

    I had not lost my job, but quit it end of summer 2008 to get away from a bully boss via an out-of-state move. The thought was to move somewhere, get a similar job and pay off my bills by living in a lower cost area of the country.
    Then the economy crashed.
    Ended up unemployed through the rest of 2008, as I worked in a fairly specialized support position. When I fianlly found a job it was in a call center and ended up paying around 30% less than I used to make.
    So I still have all my old bills to pay off anf I have to do it with close to a third less income than I used to have. Plus my experience and education doesn’t translate to the area I’m in now and I have no money for additional education.
    It’s been a bit of a struggle.

  33. Garbanzo says:

    My gross wages are down about 10% in nominal terms (ignoring inflation), with no change of job. This in a period over which my performance evaluations went up.

  34. libertysubvian says:

    My employer lowered my pay 15% 2 years ago. Was this due to the failing economy? No. My employer let our accounting department exist without checks or balances and they stole money. At the same time they decreased my pay they increased my work week by 10 hours a week with no additional compensation. They also did away with our 401(k) match. And they haven’t replaced any of the 30 employees who have quit in the last 5 years which means more work for the rest of us. Plus management mistreats its employees (example: “you’re lucky to have a job in this economy and if I want you to work Saturdays without any compensations and you don’t like it you can quit”.) Seems like a bad attitude to have when you’re a service business and you depend on your employees to keep your customers happy… but whatever… And every quarter, we get a newsletter about how great the company is doing. I no longer think “I’m lucky to have a job”, I think, “how can I get myself out of this hell-hole?”. Not that I’m bitter or anything…

    • HogwartsProfessor says:

      That sucks. I’m sorry. I felt that way too before my bosses quit. Now that they’re gone, things are a little better, that is, less stressed. And we just got wireless today, which is a sign this company might drag itself into the future.

      I still want out of here, but it’s more because of boredom and being sick of the weather in this part of the country. Trouble is, in this economy, it would be hard to find something elsewhere. My pay just now got up to the national average. (It’s less on average here because the cost of living is less.) I should be doing better, but the cost of everything has risen so much it’s not really a help.

      • libertysubvian says:

        The sad part is that my company is right. There aren’t better jobs out there in our field and therefore they can treat their employees like crap. Gee… can’t imagine why the accounting department stole money…

  35. yessongs says:

    What paycheck?????

  36. operator207 says:

    I love how people complained it was Bush’s fault when he was in office, and now that Obama is in office, they are complaining its Bush’s fault because he was the last president. Why can’t people complain about Obama like they did when Bush was in office? It only seems fair.

    Regardless of where you decide to lay blame, I changed jobs ~1.5 months ago. Laid off Oct. 19th, Received offer letter for new job Nov 16th. I now make 80% more than I did at the last job.

    I am not trying to boast, but I am doing better without changing Presidents. And when Bush was President, I changed jobs also. That took ~4 months to get a job though. I also almost doubled my salary then as well.

    Note: I dislike both Bush and Obama, for different reasons.

    • areaman says:

      From an earlier post…

      “Obama delivered on his promises, dude. I got change. Pocket change, I hope.”

      So there, that’s the first person ever complained about Obama earlier on in this topic. But no where else has anyone ever complained about the current president.

  37. Ayanami says:

    The companies are making the same profits they used to with less people, why would they hire more? Or at a better rate? We’ve been told at work multiple times, we’re all expendable and someone is waiting to take our job at 1/2 pay, so quit complaining and go do the work of 2-3 people.

  38. EverCynicalTHX says:

    Pay cuts and benefit decreases aren’t just for the unemployed. The middle class as a whole is seeing an ever decreasing standard of living for the first time since the end of WWII.

    Benefits and salaries are being cut, pensions are being eliminated and it’s a whole new ballgame given our ever increasing debt and lack of manufacturing jobs in the us. Just wait till inflation kicks in…you ain’t seen nothing yet…sigh..

  39. Karenpuppy says:

    I returned to work after 2 years of unemployment and my salary is $20K less than the job I lost, putting me at the pay scale I was at roughly 10 years ago. It just goes to show you–you’ll never be free of ramen noodles (try as you might).

    • brinks says:

      Wow. I took the same exact paycut and my cabinets now also look like they did 10 years ago: Mac N Cheese, no name brands, and no non-essentials (I’ll miss you, Sun Chips).

  40. WeirdJedi says:

    It might be amusing but I actually got a raise my quitting my job and returning a few months later when I couldn’t find another/better job. Sure it might be minimum, but I guess 10K a year is better than nothing. In the two years I’ve been searching, I must have gone to about 200 different places. I don’t think there would be another job that would pay me less, that’s for sure.

  41. Nick says:

    “While difficult for individual workers, lower wages can make U.S. industries and companies overall more competitive and allow employers to hire more workers than they would otherwise. In the long run, that may make the nation more prosperous.”

    WSJ squeezes this in there but you still have to replace “the nation” with “Goldman Sachs” and “difficult” is putting it lightly.

    • Papa Bear says:

      This is only true if those lower wages equate to the higher profits used for building business and not for purposes of paying outlandishly high bonuses and dividends.

  42. Consumeristing says:

    It’s hard NOT to blame Obama. No president has every had to spent several trillion dollars (granted a lot of the bailouts were initiated by Bush, but Obama voted and extended and keep refunding them) and got bupkis in return. He “inherited” a 7% unemployment rate, and now it’s been 20 months at 9%+, a record in US history. He boasted about his plans during the embarrassing “summer of recovery” this year when every months showed job losses. So now we’re mired in deeper debt, and it didn’t buy us anything sustainable that we can take to the bank to pay off those debts.

    What made previous recession recoveries different was how little the government had to intervene to goose the economy back up AND create jobs. This “recovery” is not good because it’s the slowest we’ve ever seen so far. At this point, there should be 4%+ GDP growth for several quarters like in the post early 80s recession. 2.5% and lower isn’t gonna cut it.

    Obama wanted and spent accordingly to get credit for an economic recovery. He’s not getting it, he is (partially) to blame. If you do, I completely understand why.

    • tooluser says:

      “Bupkes”, not “bupkis”.

      Bupkes = Yiddish for “goat droppings”. Literally worse than nothing.

  43. richcreamerybutter says:

    For the past couple of years, I’ve been making $15/hr less than I was in 2002 in spite of the fact that I still have the energy and ideas of my earlier years combined with much experience and wisdom. So, I’ve decided to take this opportunity and finally transition into another more desirable field. I know that the pay cut I’ll be taking as I learn the ropes won’t be too severe in context of overall pay cuts, and ultimately I’ll be making an investment to be happier in my new line of work.

  44. bluline says:

    I was out of work for 16 months, from February 2008 until June 2009. When I finally landed a job, it was for 11% less than what I used to earn, and I haven’t had so much as a nickle pay increase since I’ve been there. But that’s not a complaint. I was just thrilled to get a job at age 55.

  45. livingthedreamrtw says:

    I just graduated and am looking for a job. My salary was $20k during grad school (stipend) and is now $0 aside from blogging income. Of course, since I was a student first my school 1) never had to pay me benefits with more hours than regular employs and 2) made me ineligible for most unemployment benefits. Of course, now when I get a real job, I will likely be earning $20k/yr LESS than what I could have got when people were getting jobs with their bachelor degrees when I graduated.

  46. eligiblebachelor says:

    I wish you were right. I applied to a non regular job for a non-profit paid $12 an hour 40 hours a week, one of the people I interviewed with told me I was overqualified, and that I should be looking for a different job. He had an HR rep call me to say “we’re going in a different direction”.
    I’ve done some contract work on and off for my past employer at a rate that pays less than unemployment hoping to get my old job back, run into people who are in a position to hire me etc.
    I’m not aware of warehouse jobs that pay $30 or 40K. In Detroit warehouse jobs are hiring for minimum wage if you can get one.

  47. phonic says:

    Lets see, my company got bought out a year ago and at Christmas all the new policies went into effect. My health care cost didn’t just double, but tripled. I was told I make too much money and not to expect a raise for a long time (I have been with my company for 4 years and just broke the 40K threshold.) and my vacation time , well I lost a week so now I get to work more for less. The new owners give new meaning to strict and myself and my co-workers live in fear we will be fired every day because of all the new policy changes we do not always know if we are doing something “wrong.” But at least I have a job, for now.

  48. dush says:

    Now that we’re not paying as much into social security my check went up!

  49. Papa Bear says:

    I’ve read a couple of arguments here about lower wages equating to the business being more competitive allowing it to create more sales and thereby hire more people. A good theory, if it were being applied.

    What is in fact happening is that lower wages are being used to enhance executive salary packages and increase dividends. Thus, the money that should be used to build the business and, in turn, increase profits and jobs, is going to investors and executives. This allows businesses to maintain the status quo, or even accept cuts, as far as sales and production, so there is no need for new labor.

    The gap between executive salaries and middle- and entry-level management is larger than it has ever been while it is at those levels that most of the actual, constructive business is done. That gap is significantly larger when it comes to labor – the source of production. Even skilled labor wages, once considered a taboo to reduce, have seen huge declines. While executive salaries and bonuses continue to grow, albeit at a slower rate than in the recent past.

    Another area of increase is in dividends. I am not referring to common stock dividends which have really stagnated, if not stopped all together, but to preferred stock offerings. In the past, a stock holder was satisfied with a 7 to 10% profit on investment. This was at a time with a 90% tax rate for the wealthiest. Today, with tax rates a third of that, investors are demanding as much as 20 to 25% returns. Guess what, many of these investors are also executives who are receiving shares of preferred stock as part of their salary package.

    A model used by a business instructor I had once demonstrated that the average Fortune 500 business could increase its productivity, invest in building sales and new products, and maintain labor wages and benefits simply by returning top tier executive salaries and dividends to the percentages they were at in 1960. This model was built by some Wall Street hot shot, who much like the hot shots who predicted the mortgage collapse, was chastised and run out of the business. This was a class I took in the late ’90′s and the guy had predicted the current wage earnings debacle back then!

    Another area that is really hurting the American economy is the outrageous government salary and benefits packages and the huge amount of double dipping that is going on with military retirees getting government jobs. Having returned to school to earn a paralegal degree at an actual school not an on-line or for profit diploma mill, I have had occasion to see some government salary statistics for the field. A government employed paralegal, on average, earns between $15 and $20,000 per year more than a private sector paralegal. This is so in the vast majority of para-professional positions and even in many professional positions. It is getting to be that way in many labor positions, also.

    On top of that, a large number, if not a large majority, of government positions are going to ex-military who are already receiving government pensions and benefits. I respect and thank these guys and gals with all of my heart for their services. Some of them are near and dear to me as Dad was a Purple Heart WWII vet. Older brother is Viet Nam era Army vet (working for the Navy now) and kid brother is an ex-Marine. But that does not change the fact that extremely large numbers of unemployed and under-employed people could be working if people who are not already receiving very livable government retirements were not taking the jobs. The problem even extends to civilian employees retiring and then going to work for another agency or branch of the government.

    I know I will get grief for this, but the truth is the truth. Our service men and women deserve our best when it comes to medical treatment, insurances and retirements, but we cannot cut the throat of the American economy by giving those who already have excellent retirement packages the cream of the jobs.

    If things were still the way they were 25 years ago, I wouldn’t be making this comment, but the fact of the matter is that most military retirees can live quite well on their pensions and one of the under-paying jobs many of us are forced into while another deserving person gets the good paying government position if they qualify else wise.

  50. YokoOhNo says:

    We are finally getting closer to the point we can operate in a true free market!!

    $3/hour jobs and monopolies for everyone!! Actually, employment by monopolies.

    • EverCynicalTHX says:

      There should be NO monopolies in a true free market system. Every economist knows this and as a country we have the laws in place to correct this. Unfortunately, our politicians have become reliant on campaign contributions and neither party seems willing to enforce anti-trust enforcement.

      Man, how I wish we had Teddy Roosevelt in office right now.

  51. Mr Fife says:

    Our incredibly awful political leaders NEVER take a pay cut, despite ruining the country. Maybe the Chinese will kill the sorry rats when they take over.

  52. brinks says:

    From 2007 to 2010 I worked for the same employer (it’s a retailed, and I’ve mentioned them by name in several comments in the past). This was the first time that anyone ever paid me anywhere near what sites like Salary.com claimed someone with my experience and education should be making. I hated the job but liked the paycheck, even though for the three years I was there, they always had a reason why they would not give me a raise. To save his own ass, my boss blamed me for some stuff he screwed up and got me fired. I knew I’d never see that kind of paycheck again, but I was still hopeful.

    I took the first job that came my way, which was as a commissioned manager at a shoe store. The store did no volume and i made minimum wage. I found another job as a store manager at a kid-friendly mall store that paid me about $8000 less that the job that fired me, but it was good enough pay for what it was. The problem is, though, I really don’t care for kids too much and I couldn’t stand it.

    I just now found the one and only retail job where I get off work no later than 6:30 PM and I don’t work Sundays. I’m now making less than I did 10 years ago, when my rent way waaaaaay cheaper, but the job itself is great. Since I obviously can’t win (hate my job with a passion and pay the bills, or love my job and go hungry?), I’m keeping this wonderful new job and looking at possibilities for a second job now that my nights and weekends are free.

  53. retailriter says:

    I’m making less now than I was TWENTY YEARS AGO and my health insurance back then was about $25.00 per pay period (every two weeks) for Medical, $10.00 for dental and vision combined. My job at that time included a company paid-pension.