1. World problems
  2. Decline in real wages

Decline in real wages

  • Decline in personal income
  • Decline in earnings
  • Declining family economic conditions

Nature

The decline in real wages refers to the reduction in the purchasing power of income, adjusted for inflation. This phenomenon occurs when wage growth fails to keep pace with rising prices, leading to decreased living standards for workers. It can result from various factors, including economic downturns, shifts in labor markets, and changes in government policies. A sustained decline in real wages can exacerbate income inequality, reduce consumer spending, and hinder economic growth, ultimately posing significant challenges for individuals and society as a whole. Addressing this issue is crucial for ensuring economic stability and improving quality of life.This information has been generated by artificial intelligence.

Incidence

[Developing countries]

The developing world still depends on raw materials for the majority of its export earnings. But in the last ten years, real prices, and hence wages, the developing world's principal commodities, including fuels, minerals, jute, rubber, coffee, cocoa, tea oils, fats, tobacco, and timber have fallen by approximately 30%. The per capita income of the average Latin American is 9% lower today than it was in 1980. In some countries the standard of living has slipped back to what it was 20 years ago; one third of Latin America's population, 130 million people, live in dire poverty.

[Industrialized countries]

A 1991 study in the USA concluded that there had been broad-based wage reductions during recovery from the recession, including severe declines for both blue and white collar men and for both college-educated and school-educated workers. The real wages of most groups had decreased over the previous 20 years had decreased among men, notably amongst the less well-educated. A 1994 ECE report confirmed that cuts in income levels in western market economies had been most severe for unskilled workers in the USA, where real wages in the lowest-paid 10 percent of jobs fell by more than 1 percent a year in the 1980s, and in the UK where social protection had been reduced significantly during the previous decade.

Claim

The decline in real wages is a critical issue that undermines the very foundation of our economy and society. As inflation outpaces earnings, hardworking individuals and families struggle to make ends meet, leading to increased poverty and social unrest. This erosion of purchasing power stifles consumer spending, crippling businesses and hindering economic growth. We must urgently address this crisis to ensure fair compensation, restore dignity to work, and secure a prosperous future for all.This information has been generated by artificial intelligence.

Counter-claim

The so-called "decline in real wages" is overstated and largely irrelevant. Many factors, such as technological advancements and increased productivity, have transformed the job market, creating new opportunities and higher-paying roles. Instead of fixating on wage figures, we should focus on the overall economic growth and the rising standard of living. Complaining about wages distracts from the real progress being made and undermines the resilience and adaptability of the workforce. Let's celebrate innovation instead!This information has been generated by artificial intelligence.

Broader

Decline
Yet to rate

Narrower

Pay freeze
Unpresentable

Aggravates

Suicide
Excellent
Wage discontent
Unpresentable
Disillusionment
Unpresentable
Fear of spending
Yet to rate

Aggravated by

Underemployment
Presentable

Related

Strategy

Reducing wages
Yet to rate
Monitoring wages
Yet to rate

Value

Uneconomic
Yet to rate
Decline
Yet to rate

SDG

Sustainable Development Goal #8: Decent Work and Economic Growth

Metadata

Database
World problems
Type
(D) Detailed problems
Biological classification
N/A
Subject
  • Economics » Economic
  • Social activity » Employment conditions » Employment conditions
  • Social activity » Income
  • Society » Family
  • Content quality
    Presentable
     Presentable
    Language
    English
    1A4N
    D2769
    DOCID
    11427690
    D7NID
    142232
    Last update
    Nov 7, 2022