THE VIRGINIAN-PILOT
Copyright (c) 1994, Landmark Communications, Inc.
DATE: Monday, September 5, 1994 TAG: 9409010019
SECTION: FRONT PAGE: A8 EDITION: FINAL
TYPE: Editorial
LENGTH: Medium: 55 lines
Labor Day is a time of mixed feelings for many. It's a long weekend, a chance to relax with family and friends and enjoy the fruits of what our labor has brought us. At the same time, it's tinged with sadness, the knowledge that another summer has passed and autumn's first frosts aren't far off.
It's also a time for reflection on the value of work. Always, it seems, people complain that things used to be better. Very few of us don't feel that we get worse off financially than better. Business Week magazine recently devoted a cover story to that old bugaboo from the Reagan years, income inequality. Some fret that it's rising. The figures, however, indicate that the gap between rich and poor widens because most Americans are getting richer, not poorer.
According to Forbes magazine, the households in the lowest 20 percent of the American population in 1967 had incomes equivalent to 8.9 percent of the mean annual income of households in the top one-fifth. Today, that number has fallen back to 8 percent. But the greatest narrowing of the income gap - to 9.3 percent - took place in 1979, one of the worst economic years since the end of World War II.
The number of people who are truly poor has also fallen. Households with incomes under $10,000 per year (in inflation-adjusted dollars) have declined from 17.2 percent of all households in 1967 to 14.6 percent today.
Why the rising inequality gap? It's largely explained by the surge of mothers in two-parent households into the work force. According to a study by Lynn A. Karoly of the RAND Corp. and Gary Burtless of the Brookings Institution, women are better educated and, therefore, better paid than they were. Their gains in earnings account for almost 40 percent of the rise in ``inequality'' in household income since 1979.
Indeed, women's pay has risen rapidly in the past decade and a half, much of it during the Reagan boom. According to Department of Labor statistics, the median earnings of women working full time in the second quarter of this year were 76 percent that of men, up from 60 percent in 1979.
What income inequality figures mask, of course, is the churning motion of social mobility. Making it to the top is no guarantee of staying there: Every year sees small but significant turnover in the Fortune 500 list of the biggest corporations and the Forbes 400 list of the richest Americans. And on a less exalted level, plenty of American households still move from the lower range of the income scale to the highest. (And vice versa.) Still others, of course, would love to find work, but for whatever reason, cannot.
The American work force has seen better times. It has also seen far worse. By and large, most American workers are better off this Labor Day than they were in the depths of ``malaise'' 15 years ago. And that's worth celebrating. by CNB