The State of Working Wisconsin Laura Dresser Joel Rogers Julie Whittaker Center on Wisconsin Strategy

The State of Working Wisconsin Laura Dresser Joel Rogers Julie Whittaker Center on Wisconsin Strategy

The Center on Wisconsin Strategy Authors Laura Dresser Joel Rogers Julie Whittaker Acknowledgments

Table of Contents Executive Summary...1 Introduction... 4 1. Wisconsin in Perspective...6 2. Income in Wisconsin... 13 3. Poverty in Wisconsin... 23 4. Wages in Wisconsin... 29 5. Explaining Wisconsin s Falling Wages... 44 Conclusion... 61 Table and Figure Notes... 65

Executive Summary

Introduction Design of the Report

Data Sources and Reporting Conventions

1. Wisconsin in Perspective

Median Household Income (1993 Dollars) 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 U.S. Wisconsin

Median Household Income (1989 Dollars) 50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 0 White Household Income Black Household Income Wisconsin - Black Wisconsin - White U.S. - Black U.S.- White

30 Percent of Individuals in Poverty 25 20 15 10 5 Wisconsin U.S. 0

Percent of Children in Poverty 60 50 40 30 20 10 White Child Poverty Black Child Poverty U.S. - Black Wisconsin - Black 0 Wisconsin - White U.S. - White Percent of Adults with College Degrees 70 60 50 40 30 20 10 Black with College Degree White with College Degree Native American with College Degree Asian with College Degree Wisconsin- White Wisconsin - Black Wisconsin - Asian 0 Wisconsin - Native American

30 Percent of Workers in Unions 25 20 15 10 5 U.S. Wisconsin 0

2. Income in Wisconsin Wisconsin s Economy Is Growing, but Median Income is Stagnant

Thousands of Dollars (1994 Dollars) 18 16 14 12 10 8 6 4 2 U.S. Real Per Capital Income Wisconsin Real Per Capital Income 0 1959 1964 1969 1974 1979 1984 1989 1994 Annual Real Per Capita Income Growth (Percent) 3 2.5 2 1.5 1 0.5 0 2.77 2.57 1.56 1.49 1959-73 1974-93 U.S. Wisconsin

1994 Dollars 50,000 45,000 40,000 35,000 30,000 25,000 20,000 15,000 10,000 5,000 U.S. Family U.S. Family of Four Wisconsin Family of Four 1947 1953 1959 1965 1971 1977 1983 1989 1993 Annual Growth Rate (Percent) 4 3.5 3 2.5 2 1.5 1 0.5 0 3.55 2.78 0.14 0.23 1947-73 1974-93 U.S. Wisconsin

Wisconsin Family Incomes Have Fallen Even Though More Family Members Work

Increasing Income Inequality in Wisconsin Poorest Fifth Next Poorest Fifth 12% 6% Middle Fifth 18% 40% Richest Fifth 24% Next Richest Fifth

Disparities in the Distribution of Income by Race and County Percentage of Population in Income Group (Income in 1994 Dollars) 100 90 80 70 60 50 40 30 20 10 0 White Black Native Asian Hispanic American $56,692+ $28,347-$56,691 $11,339-$28,346 Less than $11,338

Tax Burdens Shifted onto the Middle Class

3. Poverty in Wisconsin

Poverty in the State is Below National Levels but Increasing

Disparities in Poverty by Race and County 60 Percentage of Children in Poverty 50 40 30 20 10 0 14.9% Total 9.9% White 55.8% Black 46.1% Native American 48.8% Asian 32.6% Hispanic

Anti-Poverty Programs Lift Few Out of Poverty

4. Wages in Wisconsin Wisconsin Wages Fall at Nearly Three Times the National Rate

Real Hourly Wages (1994 Dollars) 16 14 12 10 8 6 4 2 0 U.S. Wisconsin All Workers U.S. Men Wisconsin U.S. Women Wisconsin 1979 1989 1993

16 Real Hourly Wage (1994 Dollars) 14 12 10 8 6 4 2 0 U.S. White Men Wisconsin U.S. Black Men Wisconsin 1979 1989 1993 Real Hourly Wage (1994 Dollars) 12 10 8 6 4 2 0 U.S. Wisconsin White Women U.S. Wisconsin Black Women 1979 1989 1993

Poor Wage Performance for Wisconsin s Education Groups

25 Real Hourly Wages (1994 Dollars) 20 15 10 5 0 U.S. Wisconsin U.S. Wisconsin U.S. Wisconsin No High School Degree High School Degree 1-3 Years Post High School U.S. Wisconsin College Degree 1979 1989 1993

16 14 Real Hourly Wages (1994 Dollars) 12 10 8 6 4 2 0 U.S. Wisconsin U.S. Wisconsin U.S. Wisconsin No High School Degree High School Degree 1-3 Years Post High School U.S. Wisconsin College Degree 1979 1989 1993

The Rise in Poverty Wage Jobs

Percent of Labor Force 50 45 40 35 30 25 20 15 10 5 0 25 36 35 46 39 36 Poverty Wage Jobs Decent Wage Jobs 1979 1989 1993

70 Percent of Labor Force 60 50 40 30 20 10 0 14 24 26 16 32 53 40 47 42 34 56 63 White Men Black White Black Women 1979 1989 1993

70 60 Percent of Labor Force 50 40 30 20 10 0 64 53 48 61 45 31 22 24 26 31 14 14 White Men Black White Black Women 1979 1989 1993 The State s Unequal Distribution of Unemployment

5.Explaining Wisconsin s Falling Wages

Geographical Shifts, Not Industry Employment Shifts, Account for Wage Decline

Professional Services Entertainment & Recreation Services Personal Services Business & Repair Services Finance, Insurance & Real Estate Public Administration Agriculture, Forestry & Fishing Construction Durable Manufacturing Retail Trade Wholesale Trade Transportation, Communication & Public Utilities Non-durable Manufacturing Professional Services Entertainment & Recreation Services Personal Services Business & Repair Services Public Administration Agriculture, Forestry & Fishing Construction Durable Manufacturing Finance, Insurance & Real Estate Retail Trade Wholesale Trade Non-durable Manufacturing Transportation, Communication & Public Utilities

-25-20 -15-10 -5 0 5 10 15 20 Percent Change in Real Hourly Wages, 1979-93 Retail Trade Durable Manufacturing Non-Durable Manufacturing Finance, Insurance & Real Estate Transpotation, Communication & Public Utilities Construction Business & Repair Services Wholesale Trade Public Administration. Personal Service Men s Real Wages Fall in Most Industries

Professional Services Entertainment & Recreation Services Personal Services Business & Repair Services Finance, Insurance & Real Estate Public Administration Agriculture, Forestry & Fishing Construction Retail Trade Durable Manufacturing Wholesale Trade Transportation, Communication & Public Utilities Non-durable Manufacturing Professional Services Entertainment & Recreation Services Personal Services Business & Repair Services Public Administration Agriculture, Forestry & Fishing Construction Finance, Insurance & Real Estate Retail Trade Durable Manufacturing Wholesale Trade Transportation, Communication & Public Utilities Non-durable Manufacturing

-25-20 -15-10 -5 0 5 Percent Change in Real Hourly Wages, 1979-93 Durable Manufacturing Retail Trade Non-Durable Manufacturing Construction Transpotation, Communication & Public Utilities Business & Repair Services Wholesale Trade Public Administration.

Women s Real Wages Rise in Many Industries

Professional Services Public Administration Agriculture, Forestry & Fishing Construction Durable Manufacturing Entertainment & Recreation Services Personal Services Business & Repair Services Non-durable Manufacturing Transportation, Communication & Public Utilities Wholesale Trade Finance, Insurance & Real Estate Retail Trade Professional Services Public Administration Agriculture, Forestry & Fishing Construction Durable Manufacturing Entertainment & Recreation Services Personal Services Business & Repair Services Finance, Insurance & Real Estate Non-durable Manufacturing Transportation, Communication & Public Utilities Wholesale Trade Retail Trade

Professional Service Retail Trade Durable Manufacturing Non-Durable Manufacturing Finance, Insurance & Real Estate Personal Service Public Administration. -10-5 0 5 10 15 20 Percent Change in Real Hourly Wages, 1979-93 Eroding Minimum Wage Hurts all Low Wage Workers

Decline in Unionization Increases Wage Inequality

Percent of Private Sector Labor Force in Unions 20 15 10 5 0 20 17 17 13 13 11 Wisconsin U.S. Wisconsin U.S. Wisconsin U.S. 1983 1988 1993

Percent of Private Sector Labor Force in Unions 40 35 30 25 20 15 10 5 0 36 28 31 22 27 20 Wisconsin U.S. Wisconsin U.S. Wisconsin U.S. 1983 1988 1993

60 Percent of Workers in Unions 50 40 30 20 10 0 45 20 24 49 17 22 52 13 19 1983 1988 1993. Public Private Total New Work Arrangements Reduce Job Quality

Percent of Work force in Part-Time Jobs 25 20 15 10 5 0 1.3 20.8 2.3 20.8 19.2 1979 1989 1993 3.4 Involuntary Part-Time Voluntary Part-Time

Conclusion

Table and Figure Notes Frequently Cited Sources Census City and County Data Book CPS CPR ERP Green Book Kids Count NBER-CPS Statistical Abstract 1994

Table Notes Chapter 1 1.1 Chapter 2 2.1 2.2 2.3 Chapter 3 3.1 3.2 3.3 Chapter 4 4.1 4.2 4.3 4.4

Chapter 5 5.1 Figure Notes Chapter 1 1.1 1.2 1.3 1.4 1.5 1.6 1.7 Chapter 2 2.1 2.2 2.3 2.4 2.5 2.6 Chapter 3 3.1

Chapter 4 4.1 4.2 4.3 4.4 4.5 4.6 4.7 4.8 Chapter 5 5.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8 5.9 5.10

5.11 5.12 5.13

Bibliography