My first thought was to think, Wow this really provides a strong counterargument to people who keep touting the fact that 47% of US citizens don't pay any income taxes (other than FICA). Also I was shocked to see that "The 1%" included essentially anyone making over $200K. [edit: i originally made a mistake and said $100K]
But in looking more closely, I can't tell if the numbers are based from individual W2s (meaning a single individual with two jobs might contribute two separate data points), on individual taxpayers, or individual tax filings (maybe a family).
I suspect it's one of the first two. And if that's the case, these numbers can't directly be applied to stats about poverty levels or the "99%" and the "1%" and the "47%" figures being slung around these days.
For instance, these numbers include part time workers, such as teenagers with after-school jobs. At minimum wage, working 4 hours a day for 6 days a week for 50 weeks, this person might earn ~$8K.
So it's likely that some part of that first 25% on the chart are part-time workers.
That's not to say that there aren't some families doing everything they can to make just $8K in a year, but rather that the percentages would sound different if we built the chart using only data from tax returns (not W2s) and stripped out everyone who was not attempting to work full time to support themselves or a family.
Can someone provide insight that would either debunk or validate my assumptions above?
A large fraction of the 47% are the elderly. The evil rank dishonesty of the people who started this meme (not the useful ignorant who spread it) is highlighted by the fact that the elderly are their electoral base. Rich men are encouraging senior citizens watching Fox to think that "they" are freeloaders ... and using those same senior citizens to inflate the number of supposed freeloaders. That's on TOP of not including payroll, sales, and other taxes with regressive distributions when they calculate tax burden.
The data only includes the types of compensation that are subject to FICA. This includes only salaries, wages, bonuses, profit sharing and tips. It does not include dividends, capital gains (includes things like options) and interest income.
The data does include part time workers, including students. There aren't that many teens and college students in the US (only about 10% of the population). It also includes some retired people working part time jobs.
I think the IRS and the US Census publishes similar data but uses total compensation. IIRC, the median moves up a bit (but still under $30k) while the top end skews upwards dramatically.
To those who say "someone can do two jobs and make more" and such... These stats are compiled on SSN basis by the Social Security Administration. Thus, I think they include any number of jobs a person may hold at any time over the course of the year.
Further, this data does not include dividends, capital gains or interest. Should be fairly obvious which end of the curve gets the lion's share of that.
> Further, this data does not include dividends, capital gains or interest. Should be fairly obvious which end of the curve gets the lion's share of that.
But it also doesn't include unreported income, public grants, welfare, food assistance programs, Medicare, Medicaid, retirement funds, pensions, Social Security, receipt of charity, etc.
It also fails to realize that some of those low-income workers are homemakers who only work a few hours a week to get out of the house, teenagers and young adults just working for spending money, and retired elderly who are looking to stay active and supplement their fixed income without working too hard.
I'm not against social assistance by any means, but trumpeting misinformation only serves to muddy the waters and harm productive discussion.
Actually most middle class Americans, and basically all Americans in IT jobs commenting on the web, have no frigging idea of how the "other half lives"...
So with all of this top x% talk that is going on I decided to see where I was on the scale. It was pretty pathetic. Not because I was low on the scale but rather very high. I don't consider myself to be very wealthy at all. Don't get me wrong I am doing well for myself. I worked hard to get what I have and I am good at what I do, but I should not be in the top 3%. I am not trying to brag, I think it is stupid and wrong that I am that high up on the scale. I'm not saying I earn too much (I am actually underpaid according the the industry i am in.) It is just that I can't believe that others are being paid that much less.
The incredible wealth disparity in this country is quite disturbing. And one look at the data confirms that reality. Half of workers barely make enough to get by. And I assure you that a very large portion of those making under the median probably get poor benefits/heathcare (if they get them at all)
Some 30% of Americans have a Bachelor's Degree or higher.
According to the Census, the median income for people with a Master's Degree is $54K (for ages 25-64), while those with only a High School diploma get $22K.
We need to improve our education situation 15 years ago, IMHO.
Edit: I'm going to edit this because people seem to think I'm suggesting a causal relationship here. I'm not. People with Master's Degrees tend to be highly trained in their field. It's not particularly surprising they tend to earn more.
If you invest the time to make yourself less replaceable, you will earn more money.
<sarcasm> Clearly they all need to apply to Phoenix University, get a $60K loan from Uncle Sam so they too can get that sweet $54K job </sarcasm>
Not saying that education is not lacking but rather that there is a already a predatory system set up to get this people deeper in dept without necessarily providing a better chance at getting job.
The problem is that those degrees don't mean anything in most professions. They are used by those with the degree to get more money and used by the employers to pay less to those that don't have them. I know in my profession I have worked to MIT grads that are just a stupid as those with no degree.
Statistics like this just encourage people to spend lots of money on useless degrees that will take a long time to pay off. (I know some of these people.) I doubt a philosophy degree will get you more money anywhere other than as a philosophy professor.
I do think that looking at all workers is a valid metric of how we're doing as a nation, but it is important to remember that all workers does include those working part time. It is a valid metric because there are many people out there who would like to be working full time who are not, but it can be misleading because it sort of looks like everyone took a pay cut. But that isn't the case. Some people took a pay cut. Some people had their hours cut. Some people got laid off and could only find a part time job to replace their full time job with.
> Some people took a pay cut. Some people had their hours cut. Some people got laid off and could only find a part time job to replace their full time job with.
At the end of the day that still looks like a collective pay cut. Some took a part-time pay cut, some took a paycut down to 0.
From what I hear from people working in retail (I am sure it is true for other places as well), employers are cutting everyone to part time hours so they don't have to pay benefits. So people find 2 part time jobs to make ends meet. They effectively work full time and more , but now they don't have health benefits. First trip to the hospital and it is all over, they can't get out of dept, ever.
It's a lot scarier once you realize that only 45% of Americans are workers. What this actually means is that 87.5% of Americans are earning less than $26,000.
I'd like to see this data over a longer time period. Or compared to a similar time span around the Great Depression. Similarly, I'd like to see data on a global scale. I'd imagine the gap is continuously widening. Markets constantly shift, this may be a second re-adjustment from the dot.com bubble, just the "99 percent" are adjusting as the 1% goes the other way.
No the gap is not continuously widening everywhere. It rises and falls a lot. There is one measure and a historical chart in this article. http://en.wikipedia.org/wiki/Gini_coefficient
This is one of those charts that is great for grant writing (if you get your local area data) or making a point in an article, but doesn't really tell you the whole story. It doesn't list all the income and really doesn't give you a real picture based on family make-up. Don't get me wrong, its useful data, but it can be used in a very poor manner.
These figures are interesting, but you really need to take into account cost of living to get an accurate picture of poverty. $26,000/year would barely cover my rent for a tiny one-bedroom apartment in San Francisco, whereas in other places, it's enough to live somewhat comfortably.
This is only for income reported on a W2, i.e. employees. So the "top 1%" is the top 1% of individuals paid by a company, not the actual owners themselves (although I suppose they could be the same). The top 1% include a ton of business owners.
Here in Ontario, minimum wage is $10/hour. Assuming you work 9 hours a day, 6 days a week:
10 * 9 * 6 * 52 = $28,080 / year
No, I don't think 54 hours / week is too much to ask. I'm sure most people making over the 26k probably work more than that. Yes, I know this is Canada, but it's just an example.
There are currently only five provinces/territories in Canada that mandate a minimum wage at or above $10/hour. Those are Ontario, Nova Scotia, Manitoba, Newfoundland, and Nunavut. Even then, Manitoba and Nova Scotia only made it to that level on the first of this month. Nunavut is an anomaly in and of itself because everything is expensive as hell up there - it has a ridiculous cost of living from what I'm told - because it's remote and shipping supplies is costly.
Also, why do you think it's acceptable for people to only have one day a week away from work? Why is a nine hour workday acceptable? Are you taking into consideration that lower income workers are more likely to have to live further from work, and use public transportation to get to and from their place of employment (or to the grocery store, etc. but that's outside of my argument). So these people should have to work nine hours a day, plus any unpaid breaks they take. IIRC, my girlfriend is paid for breaks but not for lunch, so let's add a half an hour to this example to accommodate that. So we're at 9.5 hours per day, six days per week. Now, the worker has to walk to their bus stop - and to do it early so as not to possibly miss the bus - and maybe take a 15, or even 30, minute bus ride. They do that twice a day, to get to and from work. That's adding possibly an hour, or even more, to their day. So you're advocating that asking someone to spend nearly 11 hours a day, six days a week?
My first job out of college, doing some shitty COBOL programming, was 42.5 hours per week (40 working hours, plus an unpaid half hour a day for lunch). Because I was making enough cash to afford it, I lived within walking distance of work. It added maybe 15 minutes per day to walk to and from my job. I made between 38 and 43k for this, depending on when in my employment you asked me.
So why does it make so much sense for you to ask someone to spend an average of 66 hours a week of their time to make $28k, when I spent about 44 hours a week to make $43k?
I'm not even including the few weeks that I had to put in extra hours - no week ever really exceeding 60 hours from my recollection - at various crunch times, since I was paid out for that time, and the outlier in time was met by an outlier in pay. My hourly wage exceeded minimum wage by more than double, so including that would only skew the calculations further away from your argument.
There are a whole bunch of things I find troubling about your comment.
- Minimum wage in Canada != minimum wage in the U.S.
- Economy in Canada != economy in U.S.
- Canada has free health care, blunting the impact of a low wage job without benefits (as opposed to the U.S. where a lack of health insurance can be devastating)
- Not everyone with a minimum wage job is able to work all the hours they would like to work.
And that is without touching on whether or not you think a 54 hour work week is a reasonable thing to ask someone, possibly with children, to be working at some unfulfilling minimum wage job.
You mentioned your numbers are for Canada but I'd like to point out some things about the US.
8 hours a day is the norm here. A lot of the minimum wage workers (lower than 10$ an hour) work even fewer than the 40 hours that would constitute full time as a way to reduce businesses supposed obligation to cover healthcare / 401k / etc. I've seen in my experience many workers get cut off between 35 and 38 hours in a week to avoid this.
I would anticipate that very few people, less than 5%, of people making over 26k in the US work more than 54 hours a week... It just isn't done that way here.
Your math is suspect even here in Canada. First, for nonexempt employees (hourly), anything over 40 hours is considered overtime (1.5 rate); there may be a second point where it's double-time, but I'm not sure. So employees who can work 54 hours a week (which is an unreasonable working time, IMO) 52 weeks a year (which is also unreasonable in a civilized society) and their employers give it to them, will make more than $28k (by about $70 / week).
As a fairly young person whose health isn't that great, I find your assertion that 54 hours/week is "not too much to ask" to be disturbing, to say the least, particularly for that kind of crap pay.
I'm lucky when I can do a full 40, and I make a lot more than $26k. A LOT more.
The average is frankly, fairly uninteresting given what the distribution looks like. It's not a "typical" income, or the 50th percentile. It's just basically the sum of income divided by the number of earners.
Reminds me of the old saw about how when Bill Gates walks into a bar, everyone turns into a millionaire, on average.
These numbers seem implausibly low. How are they derived?
It says they come from W-2 filings. But do they bother to match up different W-2 filings from the same person? i.e. if I work two part-time jobs, are those added up? Or even if I switch jobs part way through the year?
Of course it doesn't include income from non-work sources (investment income etc), though that shouldn't change the median that much since people in the lower half don't have all that much in passive income.
Of course it doesn't include tips either (or it can -- reporting of tips on W-2s is, as I understand it, complicated and whatever the law is, it isn't followed).
[+] [-] aasarava|14 years ago|reply
My first thought was to think, Wow this really provides a strong counterargument to people who keep touting the fact that 47% of US citizens don't pay any income taxes (other than FICA). Also I was shocked to see that "The 1%" included essentially anyone making over $200K. [edit: i originally made a mistake and said $100K]
But in looking more closely, I can't tell if the numbers are based from individual W2s (meaning a single individual with two jobs might contribute two separate data points), on individual taxpayers, or individual tax filings (maybe a family).
I suspect it's one of the first two. And if that's the case, these numbers can't directly be applied to stats about poverty levels or the "99%" and the "1%" and the "47%" figures being slung around these days.
For instance, these numbers include part time workers, such as teenagers with after-school jobs. At minimum wage, working 4 hours a day for 6 days a week for 50 weeks, this person might earn ~$8K.
So it's likely that some part of that first 25% on the chart are part-time workers.
That's not to say that there aren't some families doing everything they can to make just $8K in a year, but rather that the percentages would sound different if we built the chart using only data from tax returns (not W2s) and stripped out everyone who was not attempting to work full time to support themselves or a family.
Can someone provide insight that would either debunk or validate my assumptions above?
[+] [-] spenrose|14 years ago|reply
[+] [-] yummyfajitas|14 years ago|reply
ftp://ftp.bls.gov/pub/special.requests/lf/aat19.txt
About 3/4 of those who are part time are voluntarily part time (i.e., not because they can't find full time work).
ftp://ftp.bls.gov/pub/special.requests/lf/aat20.txt
[+] [-] onedognight|14 years ago|reply
It looks like it's anyone making over $200k not $100k if I'm reading it correctly.
[+] [-] rmah|14 years ago|reply
The data does include part time workers, including students. There aren't that many teens and college students in the US (only about 10% of the population). It also includes some retired people working part time jobs.
I think the IRS and the US Census publishes similar data but uses total compensation. IIRC, the median moves up a bit (but still under $30k) while the top end skews upwards dramatically.
[+] [-] rmah|14 years ago|reply
Further, this data does not include dividends, capital gains or interest. Should be fairly obvious which end of the curve gets the lion's share of that.
[+] [-] BrandonM|14 years ago|reply
But it also doesn't include unreported income, public grants, welfare, food assistance programs, Medicare, Medicaid, retirement funds, pensions, Social Security, receipt of charity, etc.
It also fails to realize that some of those low-income workers are homemakers who only work a few hours a week to get out of the house, teenagers and young adults just working for spending money, and retired elderly who are looking to stay active and supplement their fixed income without working too hard.
I'm not against social assistance by any means, but trumpeting misinformation only serves to muddy the waters and harm productive discussion.
[+] [-] dextorious|14 years ago|reply
[+] [-] MrWestley|14 years ago|reply
[+] [-] geogra4|14 years ago|reply
[+] [-] sciurus|14 years ago|reply
[+] [-] beej71|14 years ago|reply
According to the Census, the median income for people with a Master's Degree is $54K (for ages 25-64), while those with only a High School diploma get $22K.
We need to improve our education situation 15 years ago, IMHO.
Edit: I'm going to edit this because people seem to think I'm suggesting a causal relationship here. I'm not. People with Master's Degrees tend to be highly trained in their field. It's not particularly surprising they tend to earn more.
If you invest the time to make yourself less replaceable, you will earn more money.
[+] [-] rdtsc|14 years ago|reply
Not saying that education is not lacking but rather that there is a already a predatory system set up to get this people deeper in dept without necessarily providing a better chance at getting job.
[+] [-] MrWestley|14 years ago|reply
[+] [-] sp332|14 years ago|reply
[+] [-] nobody314159|14 years ago|reply
Obviously an increase in PhD programs in french-fry frying would raise incomes even further.
[+] [-] rauljara|14 years ago|reply
[+] [-] rdtsc|14 years ago|reply
At the end of the day that still looks like a collective pay cut. Some took a part-time pay cut, some took a paycut down to 0.
From what I hear from people working in retail (I am sure it is true for other places as well), employers are cutting everyone to part time hours so they don't have to pay benefits. So people find 2 part time jobs to make ends meet. They effectively work full time and more , but now they don't have health benefits. First trip to the hospital and it is all over, they can't get out of dept, ever.
[+] [-] Alex3917|14 years ago|reply
[+] [-] krschultz|14 years ago|reply
[+] [-] jshort|14 years ago|reply
[+] [-] justincormack|14 years ago|reply
[+] [-] protomyth|14 years ago|reply
[+] [-] thurn|14 years ago|reply
[+] [-] spenrose|14 years ago|reply
http://www.selfsufficiencystandard.org/
It's bad out there. Most people live lives of quiet desperation.
[+] [-] smattiso|14 years ago|reply
[+] [-] dlsspy|14 years ago|reply
[+] [-] Shenglong|14 years ago|reply
10 * 9 * 6 * 52 = $28,080 / year
No, I don't think 54 hours / week is too much to ask. I'm sure most people making over the 26k probably work more than that. Yes, I know this is Canada, but it's just an example.
[+] [-] AgentConundrum|14 years ago|reply
Also, why do you think it's acceptable for people to only have one day a week away from work? Why is a nine hour workday acceptable? Are you taking into consideration that lower income workers are more likely to have to live further from work, and use public transportation to get to and from their place of employment (or to the grocery store, etc. but that's outside of my argument). So these people should have to work nine hours a day, plus any unpaid breaks they take. IIRC, my girlfriend is paid for breaks but not for lunch, so let's add a half an hour to this example to accommodate that. So we're at 9.5 hours per day, six days per week. Now, the worker has to walk to their bus stop - and to do it early so as not to possibly miss the bus - and maybe take a 15, or even 30, minute bus ride. They do that twice a day, to get to and from work. That's adding possibly an hour, or even more, to their day. So you're advocating that asking someone to spend nearly 11 hours a day, six days a week?
My first job out of college, doing some shitty COBOL programming, was 42.5 hours per week (40 working hours, plus an unpaid half hour a day for lunch). Because I was making enough cash to afford it, I lived within walking distance of work. It added maybe 15 minutes per day to walk to and from my job. I made between 38 and 43k for this, depending on when in my employment you asked me.
So why does it make so much sense for you to ask someone to spend an average of 66 hours a week of their time to make $28k, when I spent about 44 hours a week to make $43k?
I'm not even including the few weeks that I had to put in extra hours - no week ever really exceeding 60 hours from my recollection - at various crunch times, since I was paid out for that time, and the outlier in time was met by an outlier in pay. My hourly wage exceeded minimum wage by more than double, so including that would only skew the calculations further away from your argument.
[+] [-] rauljara|14 years ago|reply
- Minimum wage in Canada != minimum wage in the U.S.
- Economy in Canada != economy in U.S.
- Canada has free health care, blunting the impact of a low wage job without benefits (as opposed to the U.S. where a lack of health insurance can be devastating)
- Not everyone with a minimum wage job is able to work all the hours they would like to work.
And that is without touching on whether or not you think a 54 hour work week is a reasonable thing to ask someone, possibly with children, to be working at some unfulfilling minimum wage job.
[+] [-] tseabrooks|14 years ago|reply
8 hours a day is the norm here. A lot of the minimum wage workers (lower than 10$ an hour) work even fewer than the 40 hours that would constitute full time as a way to reduce businesses supposed obligation to cover healthcare / 401k / etc. I've seen in my experience many workers get cut off between 35 and 38 hours in a week to avoid this.
I would anticipate that very few people, less than 5%, of people making over 26k in the US work more than 54 hours a week... It just isn't done that way here.
[+] [-] alphamale3000|14 years ago|reply
52? 6 days a week? Not every job allows for it. You want to abolish week-ends? Come on.
[+] [-] halostatue|14 years ago|reply
The Federal Minimum Wage in the U.S. is $7.25.
[+] [-] nknight|14 years ago|reply
I'm lucky when I can do a full 40, and I make a lot more than $26k. A LOT more.
[+] [-] protomyth|14 years ago|reply
[+] [-] tomkarlo|14 years ago|reply
Reminds me of the old saw about how when Bill Gates walks into a bar, everyone turns into a millionaire, on average.
[+] [-] shazam|14 years ago|reply
For example, this is also true:
50% of all taxpayers make less than the median EVERY DAY
[+] [-] scarmig|14 years ago|reply
That should disturb you, especially in comparison to that stat decades ago.
[+] [-] hugh3|14 years ago|reply
It says they come from W-2 filings. But do they bother to match up different W-2 filings from the same person? i.e. if I work two part-time jobs, are those added up? Or even if I switch jobs part way through the year?
Of course it doesn't include income from non-work sources (investment income etc), though that shouldn't change the median that much since people in the lower half don't have all that much in passive income.
Of course it doesn't include tips either (or it can -- reporting of tips on W-2s is, as I understand it, complicated and whatever the law is, it isn't followed).
[+] [-] tsotha|14 years ago|reply