The Economist explains: How Clinton and Trump plan to boost wages

Posted: August 3, 2016 in economy
Tags: , ,

IN 2014 the median American worker earned the same each week, in inflation-adjusted terms, as in 2000. Over the intervening period, GDP per person grew by 13%. But during this time, the country lost about a third of its 17m manufacturing jobs, which are often middle-paying, largely because of trade, technology and outsourcing. The global financial crisis battered the labour market. And the economy developed more acute winner-takes-all dynamics, in which the highly skilled thrive but less-educated workers suffer. (The workforce aged slightly, too, which may have affected earnings.) It is unsurprising, then, that wage stagnation has been a recurring theme in this year’s presidential race. Both Hillary Clinton and Donald Trump promise to raise America’s pay. How do they intend to do it?Start with higher minimum wages. Hillary Clinton supports raising the federal minimum wage to $12 an hour, up from today’s $7.25, and supports a higher floor in some cities. Donald Trump has—true to form—changed his position multiple times. His most recent view, which emerged on July 26th, is that the federal minimum wage should rise to $10 an hour. A higher minimum wage would help some workers in the low-paying food services and accommodation industries, but would not much boost the pay of middle-earners. It might aid those middle-income households that contain a low-paid second-earner (so …

via Economic Crisis http://ift.tt/2ayXDy7

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