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My, my, how the tables have turned. Employees with college degrees saw their salaries dip in 2014 while workers without higher education experienced a mini bump in their pay, CNN Money reports.
According to the Economic Policy Institute (EPI), which analyzes Labor Data, workers with bachelor’s degrees saw their average hourly wage dip by 1.3 percent to $29.55. Employees with advanced degree experienced a larger pay cut. Their earnings fell by 2.2 percent down to $38.20.
But those who didn’t graduate high school, on the other hand, saw a small pay bump of 0.6 percent to $12.31 an hour. The hourly salaries of workers with high school diplomas remained flat at $16.46 per hour.
Some economists theorize that cities and states have been increasing their minimum wages, which helps to boost the earnings of the least educated. Los Angeles is the most recent example; it is the second largest city in America to raise its minimum wage to $15. The California city follows Seattle and San Francisco, which also made moves to lift their minimum wage to $15 last year.
As for college-educated workers, economists postulate that pay is decreasing because the pool of candidates with bachelor’s and advanced degrees is expanding, said William Emmons, economist at the Federal Reserve Bank of St. Louis. Also, today’s recent college graduates are getting paid a lot less, which is pulling down the national average.
“Recent grads, ages 21 to 24, are making 2% less than they were in 2007 and 2.5% less than in 2000,” CNN Money said, citing the EPI report. “The unemployment rate for young grads is 7.2%, compared with 5.5% in 2007.”
And the underemployed rate, which includes part-time workers who want full-time jobs and job hunters who have stopped actively looking in the past month, sits at 14.9 percent — that’s up from 9.7 percent in 2007.
Stagnating wages have remained an prominent issue in the American economy since the Great Recession, CNN Money said. Even though the economy is budding, incomes have not budged a bit — and even dipped, as aforementioned, for college-educated employees.
“Workers still don’t have the bargaining power to bid up their wages,” said Elise Gould, senior economist at EPI.
