Milken Institute Review 2Q10 Page 49

Second Quarter 2010

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The long recession that began in December 2007 has taken a

heavy toll on American workers. Unemployment, which aver-
aged 4.9 percent over the prior decade, exceeded 10 percent at
the end of 2009, and has only recently dropped backed to sin-
gle digits. Moreover, millions of workers who kept their jobs
through the crisis have been asked to do more for less pay.

But long before the recession took hold of the economy,

there was a sense that middle-income earners were increas-
ingly getting the short end of the stick. Jared Bernstein, senior
economist at the Economic Policy Institute, estimated that
average annual earnings of families in the middle fell by
nearly $800 in 2000 to 2006, after adjustments for inflation.
Hourly wages, he noted, hardly rose despite an average increase

Steven A. Nyce and

Sylvester J. Schieber

Health

Care

Inflation

Must Workers

Bear the Brunt?