Blog postings by CEPR staff and updates on the latest briefings and activities at the Center for Economic and Policy Research.

CEPR compiles recent research to illustrate the state of labor in the United States.

Center for American Progress

In light of strong GDP growth projections, Madowitz and Hanlon explore how such gains fail to improve the living standards of the working class

GDP Is Growing, but Workers’ Wages Aren’t


Jones and Shierholz break down the motivations behind Right-To-Work legislation and detail the ramifications RTW laws would have in Missouri

Right to Work is Wrong for Missouri

National Women’s Law Center

All too often employers deny pregnant workers temporary accommodations that would allow these women to work safely. This report highlights the protections afforded to pregnant workers by the Pregnancy Discrimination Act

Ensure Healthy Pregnancies and Job Security: Treat Pregnant Workers Fairly

This report provides examples of the ways in which different stakeholders have implemented new policies, practices, and strategies to strengthen support for parents in low-wage jobs

Stepping Up: New Policies and Strategies Supporting Parents in Low-Wage Jobs and Their Children


Corporate profits have been used overwhelmingly to increase shareholder value. In this report, Tung and Milani quantify how such profits could instead improve the lives of workers.

Curbing Stock Buybacks: A Crucial Step to Raising Worker Pay and Reducing Inequality


As concern for the low wages of app-based drivers grows, this report analyzes the implications of the New York City and Limousine Commission’s proposal to implement a minimum driver pay standard.

An Earnings Standard for New York City’s App-based Drivers: Economic Analysis and Policy Assessment

Urban Institute

This study examines how rising wage inequality and a boost in the federal minimum wage might affect future retirement income

Growing Wage Inequality, the Minimum Wage, and the Future Distribution of Retirement Income

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The unemployment rate for workers without a high school degree fell to 5.1 percent in July, the lowest rate since the Bureau of Labor Statistics adjusted its education measures in 1992. This is 1.9 percentage points below its year-ago rate.

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Twenty-five years ago, the Family and Medical Leave Act (FMLA) went into effect. The law had a transformative effect on the US workplace. For the first time, employers were required to provide covered employees with unpaid leave for medical- and family-related purposes. This meant that that working people were now able to take up to 12 weeks of leave a year to bond with a new child, recover from serious illness, or care for a child, partner or parent suffering from a serious illness without fear of losing their jobs. Since implementation, women and men have used the FMLA for leave over 200 million times. The FMLA provides greater freedom for those employees covered and remains a remarkable first step towards the goal of balancing “the needs of the workplace with the needs of families.” But the law was just that, a first step.

Despite the new protections the law gave to working people, the United States continues to lag behind most other nations. In fact, we are the only country besides Papua New Guinea that offers no nation-wide paid maternity leave.

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From 2001 to 2013, college enrollment in the US increased rapidly. Young people delayed the full-time work portion of their lives, ostensibly to seek skills for an evolving set of jobs. Trends since 2014, however, suggest that the increase in education is not an entirely structural change. Over the past few years, a tighter labor market has been leading more young people to full-time work, suggesting that a weak labor market, rather than simply concern over a changing set of jobs, was pushing some young people to enroll from 2001 to 2013.

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Gross Domestic Product (GDP) grew at a 4.1 percent annual rate in the second quarter, the strongest pace since a 4.9 percent rate in the third quarter of 2014. (Growth had been 5.1 percent in the second quarter.) By far the largest contributor to this growth was a 4.0 percent rate of increase in consumption spending. This was a bounce back from the first quarter when growth was just 0.5 percent. Durable goods consumption (primarily cars) were the biggest part of this story, with spending rising at a 9.3 percent annual rate.

Nonresidential investment grew at a healthy 7.3 percent annual rate. This brought the investment share of GDP to 13.6 percent, although it is still below the prerecession peak of 13.7 percent and far below the levels hit in the 1990s boom or the 1970s. The largest contributor to this growth was structure investment, which rose at a 13.3 percent rate after rising at a 13.9 percent rate in the first quarter. By contrast, equipment investment rose at just a 3.9 percent rate. This is not a story very consistent with tax cut driven investment, since structure investment generally takes far longer to plan than equipment investment.

It is likely that almost all of the structure spending in this quarter or the prior quarter was planned long before the details of the tax cut were known.

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On Tuesday, a House committee will consider a bill — H.R. 4219 — whose purpose is to preempt the paid sick days laws already passed in 10 states, the District of Columbia, and cities and counties across the country.

Mislabeled as the “Workflex” bill, it denies workers the flexibility to use paid time off when they need it. In addition, it undermines the rights employees have under state and local laws to earn paid sick days and to use them when they or their children need a day or two to recover from illness. Instead, the bill gives corporate employers the flexibility to decide whether and when a mother can use paid time off to stay home with a sick child. And, it fails to protect that mother from retaliation by her employer for using the paid sick days she has earned.

Like much other legislation opposed by the big business lobby, this bill is a solution in search of a problem. Professor Ruth Milkman and I conducted surveys and interviews at large and small companies in Connecticut and New York City after those jurisdictions passed laws that allowed workers to earn paid sick days.

These surveys revealed that, for most employers, implementing the law’s provisions was a non-event. In New York City, 94 percent of employers reported no change in productivity and 2 percent reported that productivity increased after the paid sick days law passed. In Connecticut, after a year-and-a-half of experience with the state’s earned paid sick days law, more than three-quarters of employers reported that they supported it.

The so-call Workflex bill is an affront to democracy as it calls on the federal government to undermine the right of voters or their elected representatives to pass laws that protect workers’ health and their ability to care for themselves and their children. False flag laws that pretend to give workers paid sick days but actually create a means for large corporations to evade state and local sick days provisions must be opposed.

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In a new report, Donald Trump’s Council of Economic Advisers (CEA) claims only about 1 out of every 33 Americans have income below the poverty line. This compares with about 1 out of 7 Americans according to the Census Bureau.

Why such a big difference? About half comes from using consumption data rather than income, and the other half comes from assuming the Consumer Price Index for All Urban Consumers (CPI-U) has been substantially overstating inflation since 1980.

By Trump’s CEA calculations, the official poverty threshold — $25,283 for a family of four in 2017 — is much higher than what families need to pay for housing, food, transportation, and other things needed to raise children while living at a minimally decent level.

How much income does Trump’s CEA calculate is needed to live decently? They don’t say in the report, and the American Enterprise Institute (AEI) report they rely on doesn’t disclose the dollar amount either. But, according to Luke Shaefer and Joshua Rivera at the University of Michigan — who have written an important working paper that looks at the AEI report — the AEI-adjusted poverty threshold for a family of four ends up being only $17,000 in 2011. Updating this for inflation since 2011 (using AEI’s adjustment method), I get $17,700 as today’s Trump Poverty Line for a couple raising two kids.

It’s interesting to compare the Trump Poverty Line with what most Americans think they need to live above the poverty line. According to AEI’s own public opinion research, this was $33,000 in 2016, or nearly twice the amount Trump’s CEA calculates will do.

If the Trump administration really thinks that a family of four can live decently on less than $18,000 a year, they should be transparent about it. If they don’t, they need to rewrite their report.

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The “Lost Decade” historically refers to the economic failures in Latin America during the 1980s. Starting in 1980, the region’s real per capita GDP fell 9 percent over the next three years and did not fully recover until 1994. More recently, Japan’s experience in the post-bubble 1990s has also been described as a lost decade.

However, such a connection is quite unfair. While Japan was very much a developed country by the 1990s, Latin America was developing in the 1980s, and had a lot of catching up to do, in terms of economic growth. Latin America in the 1980s should have grown much more rapidly than Japan in the 1990s. Yet from 1992 to 1999, Japan grew 5 percent per capita and 15 percent over 14 years — significant in contrast to the zero growth in Latin America over the same length of time.

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Shelter costs continue to be the main factor driving inflation. While the overall Consumer Price Index (CPI) was up 2.9 percent over the last year and the core index was up 2.3 percent, the core excluding shelter rose just 1.4 percent over the last year.

In the month of June, the non-shelter core was up 0.2 percent. Insofar as rising inflation can be viewed as a problem, it is overwhelmingly a story whereby a limited supply of land combined with building restrictions create a shortage of housing. This is largely a West Coast phenomenon, where inflation in the shelter index has been in the 4 to 5 percent range. The rate of increase in rents has been considerably lower in other regions of the country.

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At a time when we have a president grabbing kids away from their parents and a Supreme Court about to move even further to the right, the impact of auto insurance on inflation may not seem the most pressing matter. But there are aspects to the issue that are informative about how we measure and think about inflation.

First, the importance of auto insurance in overall inflation seems to have gone largely unnoticed. In the last year, it has passed medical care as a driver of inflation. The motor vehicle insurance component of the consumer price index (CPI), which has a weight of 2.4 percent in the overall index, has added more than 0.21 percentage points to the inflation rate over the last year. By contrast, medical care has added just 0.19 percentage points.

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After a long hiatus CEPR is pleased to relaunch its Labor Market Policy Research Reports. The following pieces serve to illustrate the state of Labor in the United States:

Center for Economics and Policy Research

CEPR Senior Economist Dean Baker compares hours worked among wealthy countries, discusses the benefits and drawbacks of work sharing, and offers policy proposals in:

Can Work Sharing Bring the US Workplace into the 20th Century?

Center on Budget and Policy Priorities

An empirical examination of the fallout of the Great Recession and the potential damage avoided thanks to fiscal stimulus and stabilization policies.

Chart Book: The Legacy of the Great Recession

A comparison of the extent of unemployment compensation afforded to workers in each state.

Policy Basics: How Many Weeks of Unemployment Compensation Are Available?

Economic Policy Institute

Accounting for metrics like education and migration status, this report compares the employment and wage outcomes of Hispanics and White men from 1979 to 2017.

The Hispanic-White Wage Gap has Remained Wide and Relatively Steady

New School: Schwartz Center for Economic Policy Analysis

This data summary examines earnings, pension status, participation and employment rates of workers over the age of 55.

June 2018 Unemployment Report for Workers over 55

UC Berkeley Labor Center

In its third installment The Union effect in California explores the passage of major labor-backed laws since 2011.

The Union Effect in California #3: A Voice for Workers in Public Policy 

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In spite of another large jump in employment in June, wage growth does not appear to be accelerating. The average hourly wage has increased by just 2.7 percent in the last year.

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CEPR Co-Director Eileen Appelbaum took part in a recent panel discussion on the Future of Work. This is a Q&A prepared for the event.

What are the most important takeaways from the new CWS data?

In February 2005, 7.4 percent of workers were independent contractors. In the new CWS data for 2017, this has decreased to 6.9 percent — about what it was in 2001. Gig economy workers are a subset of these workers — so the decline in the share of independent contractors was a surprise to many pundits. But other studies have shown that gig workers are less than 1 percent of the US labor force.

The low share of independent contractors is not surprising to economists who follow these issues. Independent contractors are about 60 percent of self-employed workers. Regularly published data on self-employed workers show that this category has hardly increased since 2005.

This doesn’t mean that nothing has changed since 2005. For example, the number of independent contractors in transportation has increased by about 250,000 — probably due to Uber, Lyft, Via — while those in construction decreased by almost as much. Still, 19.3 percent of construction workers are independent contractors compared with 5.7 percent of transportation workers.

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Every year, the Social Security and Medicare trustees’ report, released earlier this month, provokes a range of responses. This year’s report was no exception, even though it was very similar to last year’s report. For Social Security, an essential program that provides retirement and other benefits to millions each year,  the report predicted that it would only be able to pay 79 percent of benefits starting in 2034. This is because of a predicted shortfall in funding, which can be explained by a combination of factors, none of which imply the program is poorly run, no longer important, or fundamentally unsustainable.

While some are clear-headed about the issues facing the programs and understand its relative affordability, others provide misleading and often exaggerated narratives that rely on poorly thought-out indicators (for example, changes in worker-to-retiree ratios).

As with last year, buried deep within this year’s 270-page report are the trustees’ own facts about the program’s future. Relying on this data and based on the trustees’ logic, it is clear that Social Security is not in dire straits. Let’s walk through it.

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Earlier this year we did an analysis of CEO compensation in the health insurance industry to see if it was affected by the cap on deductibility imposed by the Affordable Care Act (ACA). One of the provisions of the ACA limited the amount of CEO pay that health insurers could deduct on their taxes to $500,000, beginning in 2013.

This provision effectively raised the cost of CEO pay to insurers by more than 50 percent. Prior to 2013, the deduction in effect meant that the government was picking up 35 cents of every dollar of CEO pay, while the companies were paying just 65 cents.[1] With the new provision in place, insurers are now paying 100 cents of every dollar of CEO pay in excess of $500,000.

If the pay reflects the value of the CEO to the company, we should expect this change to reduce the pay of CEOs in the insurance industry. For example, if a CEO gets paid $20 million a year, this should mean that she delivers roughly $20 million in additional value to shareholders.

When the CEO’s pay was fully deductible, the $20 million paid to the CEO actually only cost the company $13 million. This would presumably be the number that matters to shareholders since they care about how much money comes out of their pockets, not the number on the CEO’s paycheck.

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The May Consumer Price Index (CPI) was very much in line with expectations, as both the core and overall index rose 0.2 percent in the month. Over the last year, the core index has risen 2.2 percent, while the overall CPI has risen 2.8 percent. Inflation in the core continues to be driven largely by higher shelter costs. A core index that excludes shelter rose just 0.1 percent in May. It is up 1.3 percent over the last year.

The shelter component of the index rose 0.3 percent in May driven in part by a huge 2.9 percent jump in the “lodging away from home” (primarily hotels and motels) category. This figure is highly erratic. It has risen 4.4 percent over the last year. The shelter component has risen 3.5 percent over the last year, driven by a 3.6 percent increase in the rent proper index, and a 3.4 percent increase in the owners' equivalent rent (OER) index. The rent proper index includes utilities in many units. As a result, when energy prices rise rapidly it would be expected to increase at a faster rate than the OER index. For the month of May, the OER increased by 0.2 percent and the rent proper index increased by 0.3 percent.

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Why did the Revolving Door Project work with more than 30 other organizations in May to urge Senate Democrats to choose strong public interest-minded candidates for open leadership positions allocated to Democrats at key financial agencies, including the Securities and Exchange Commission (SEC) and the Federal Deposit Insurance Corporation (FDIC)?

Because we have learned that when reformers and progressives do not recognize that "personnel is policy" and work to identify appropriate senior leaders for Independent Agencies, the consequences can be catastrophic.

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There's a pretty good chance that you, or someone you know, has at some point worked a job that the US Bureau of Labor Statistics (BLS) would classify as "contingent" or “alternative.” These are jobs that, respectively, are not expected to last and that do not come with a traditional employment relationship. In its most modern form, this can include gig work, such as driving for Uber or providing freelance labor through TaskRabbit. However, the majority of contingent and alternative work is comprised of independent contracting, work for contract companies, on-call work, and work for temporary help agencies. On Thursday, June 7, BLS will release the results of its first survey of contingent and alternative work since 2005, giving insight into how the incidence of these types of work has changed over the past 12 years. To add context to the highly anticipated data release, let’s look at the results of the 2005 survey and outline what the release on Thursday will (and won’t) tell us.

In February 2005, questions about contingent and alternative employment were added to the regular monthly Current Population Survey (CPS). Specifically, in the case of contingent work, CPS respondents were asked whether they expect their job to continue, and for how long, or whether it is temporary in nature. BLS reports that, in February 2005, contingent workers comprise between 1.8 and 4.1 percent of the workforce. These estimates vary based on the definition of contingent — the low estimate of 1.8 percent excludes the self-employed and independent contractors, and persons who expect to continue their job for more than a year. Long-term independent contractors and self-employed workers (those who have held the job for more than a year or expect to continue in the job for more than a year) are also excluded from the larger estimate of 4.1 percent of the workforce.

As reported by BLS, contingent workers in 2005 were more likely than the overall workforce to be under age 25 and, relative to noncontingent workers of the same age, were more likely to be in school. Contingent workers were also less likely to be white, compared to their noncontingent counterparts. Contingent workers were less likely than noncontingent workers to have employer-provided health insurance or to be eligible for employer-provided pension plans. More than half of workers in this category said that they would prefer noncontingent work, and about a third said that they preferred their current arrangement.

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It has become common for economists to cite the rise in the ratio of job openings to hires as evidence that employers can't find people with the necessary skills. This then leads to an argument that our problem is not a lack of jobs in the economy, but rather that workers don't have the skills that are in demand in today's economy. We then tell workers that they need more skills, rather than blame our policymakers for not generating enough demand.

As I have been fond of pointing out, one of the sectors with the sharpest rise in openings to hires is the restaurant sector. I would not demean restaurant workers, it can be very demanding work (I did it for several years in my college days), but this is not an industry that is generally thought to demand highly skilled workers. 

Anyhow, the April data on from the Job Openings and Labor Turnover Survey (JOLTS) indicate that restaurants are finding it even harder now to find workers with the necessary skills. The job openings rate rose from 5.5 percent to 5.7 percent, while the hire rate inched up from 6.1 to 6.2 percent. The figure below shows the longer term picture for the somewhat larger leisure and hospitality sector.


My takeaway is that we can either believe that restaurant work requires many more skills than is generally realized or that the job openings to hires ratio means something different than it did two decades ago.

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The Bureau of Labor Statistics reported the economy added 223,000 jobs in May. With upward revisions to the prior two months' data, this brought the three-month average gain to 179,000. The job growth also pushed down the unemployment rate to 3.8 percent, tying a low hit in 2000 (the next previous low is December 1969). The unemployment rate for blacks fell to 5.9 percent, an all-time low.

In spite of the positive news on job growth and the unemployment rate, there is no evidence of an acceleration of wage growth, with year-over-year wage growth coming to 2.7 percent — roughly the same pace as we have seen over the last year. For all the talk of a labor shortage, we also are not seeing any notable uptick in average weekly hours. The length of the workweek overall was unchanged in May, and it actually fell by 0.2 hours in manufacturing. If employers are really having trouble finding workers we would expect them to be getting more hours out of the workers they have, but this isn't happening.

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The price of auto insurance fell by 0.2 percent in April. While this is a welcome turnaround, auto insurance costs still exceed both education and health care as a contributor to inflation. Over the last year, auto insurance prices have risen by 9.0 percent, adding 0.21 percentage points to the inflation rate. 

By contrast, the 2.2 percent rise in the health care index added about 0.19 percentage points to the inflation rate. The 1.8 percent rise in the education index added just 0.05 percentage points to the inflation rate over the last year.

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