The male median wage picture is worse than we had thought

David Leonhardt has the scoop, here is an excerpt from the quoted Michael Greenstone:

The red line is the usual picture of median earnings for full-time men. The problem with this line is that the percentage of men working over time has been declining over time. This attrition or dropping out of the labor force is not random, though, as the decline in full-time work it is disproportionately concentrated among low-skill men. This means that the red line is being propped up by the fact that it is increasingly comprised of higher skilled men.

One sensible correction for this is to calculate the median wage for all men (not just the full-time workers). This is the blue line in the below graph.

Why is this important? The full-time sample (red line) suggests that median wages have been stagnant since 1969. The blue line or full sample of men (which accounts for reduced labor force participation) suggests that median wages have declined by 32% or $15,000 (in constant dollars). [emphasis added by TC]


Looks like the first link goes back to the Yglesias post about teachers, not the intended Leonhardt link.

Tyler Cowen is shocked, SHOCKED that when you put women in the workforce and stick government's thumb on their side of the scale while jacking up the labor supply through mass immigration that the male median wage picture is worse than he had thought.

But earnings isn't the correct number to be using. Compensation is.

And yes, an ever larger part of total compensation has been coming in kind (mostly health care insurance but also shorter working hours)rather than in earnings over these decades.

How many of these low-skilled male drop-outs from the labor force have entered the black (criminal) or grey (off-the-books, for cash) labor market? I'll bet that over time a lower and lower percentage of the income of low-skilled men gets reflected in the official figures.

Insurance is a wash: younger, healthier workers subsidizing older, sicker workers. Employer contributions to 401k's are a very small fraction of compensation.

First women, then illegal immigrants.

The median person yesterday is not the same as the median person today. All this is meaningless unless one follows a panel.

Hey Chris. Very helpful, thanks.

Real hourly compensation is a better measure -- except that you can't buy groceries or pay the rent with your healthcare earnings (which are being wasted twice over by an inefficient medical delivery system.) Workmen's comp is gamed in some areas -- premiums can run to 10% of wages (I know, I'm and employer), a good fraction of which can be attributed to fraud. But it is in no ones interest to police it. The insurance companies make more and the poor slobs on the line don't know it is coming out of their take-home pay. In fact, real hourly take-home pay is the best measure of all if you are talking about standard of living. Just don't ignore hours of labor required.

'Real hourly compensation is a better measure -- except that you can't buy groceries or pay the rent with your healthcare earnings'

No, but you can, you know, live longer, healthier, fitter, more enjoyable lives. People on the board seem to be thinking that health insurance benefits are real compensation because health care is so expensive. Sure, we overpay for a lot of health benefits and care delivery is inefficient, but we still get SOMETHING out of it. It certainly is compensation and the fact that I will live much longer than the median worker 30 years ago is a benefit, one that is a big part of my compensation.

@ Steve
You forgot to mention that women are harder workers, better team-members, and superior at empathizing and communicating as well. In short, just all around superior beings.


Insurance should be for rare expensive conditions, but due to favorable tax treatment I get my standard care via insurance coverage rather than out of pocket. This is not how I would have it, but it is still part of my compensation, so it should count when we think about how much goods, services, and money men are receiving for their work.

To your point about a median worker 30 years ago being 'robbed' for not having it. I'm not sure I entirely undertand. Are you saying that because certain medical techniques, procedures, and drugs that increase life quality and quantity now did not exist 30 years ago, therefore we can't compare. If so, I disagree. Median workers 30 years ago weren't being 'robbed' but they were unable to purchase or weren't insured to recieve the level of care we have today, so we are better off. LCD tvs didn't exist 30 years ago, but that doesn't stop me from saying my televsion viewing experience is objectively better than that of 30 years ago. Apologies if I mis-interpret your point.

The point is, in-kind compensation is a large share of comp for most US men, and there is a direct benefit recieved from it, so to ignore it in any calculation of how men are faring economically relative to their fathers and grandfathers is incorrect.

@Miley and Steve: i largely agree, but a male population is only obsolete so long as a critical mass of them are not sitting around with nothing to do.

@ Devin
Totally, l didn't mean to be so harsh on men. Men are still needed to keep paying taxes that eventually go to single moms via welfare, shelling out divorce settlements and alimony and child support, and fighting and dying in wars.

@Devin and Miley: Agreed. I don't want to be too harsh either. Men are also good for making false rape accusations when one needs attention or an excuse for cheating on one's husband. And if we didn't have men, who would we put in the electric chair each year? Men are also good for being the majority in jobs with high death rates. We need someone to wash windows on the sides of high rises and get caught deep underground in coal mines.

Perhaps men could just be enslaved so that way we get the utility out of them without the other bullshit they bring along ("mathematical genius", "innovation", "caring fatherhood" and all that other baloney).

Why is the male median wage a relevant variable.

If women are getting better educated, and men are not going to college to the same degree, wouldn't male median wages decline as men compete with women in the workplace?

Why separate based on male? Why not "worker". And, why median?

Oh, by the way, their figures are for 24-64. So two other changes will be the extension of education (all those masters and PhDs) and early retirement.

Seriously not impressed by their choice of metric.

@Randall: It does not matter how wage earners "feel" about their health care benefits. It matters whether declining take home wages but increasing benefits are consistent with the TGS-hypothesis. I think not. All those hospitals, clinics and MRI-scanners which may or may not be appreciated at cost by wage earners do represent real resources.

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