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U.S. Employees: Working Hard and Hardly Paid

Americans outwork many peers abroad because their hourly productivity isn’t compensated enough.

January 4, 2016

Americans outwork many peers abroad because their hourly productivity isn’t compensated enough.

1. On average, in 2014, Americans spent 1,789 hours on the job — an increase of 22 hours from 2009, when the U.S. economy was in deep recession.

2. That total number is still lower than the 1,800 hours worked annually as of 2006, before the onset of the recession induced by the global financial crisis.

3. The figures for the United States translate to a total of 44.7 workweeks, measured at 40 hours each.

4. The key economic challenge for the United States is that while output per worker is high, the gains from that high level have not been widely distributed.

5. Specifically, wages have not kept pace with increases in worker productivity over the past several decades.

6. In real terms, median weekly wages have only grown by $16 since 1979 — only a 2% rise over a time span of three-and-a-half decades.

7. Labor productivity in the U.S. business sector increased by more than two-thirds in the same span.

8. By not raising wages, employers ensured these gains accrued to them in the form of record profits — which were used for executive compensation and shareholder payouts rather than for workers.

9. U.S. workers have much higher productivity than Greek workers — generating $66.00 in GDP per hour on average, or 86% more.

10. Like Greeks, and unlike Germans, Americans have to work long hours. Unlike in Greece, where worker productivity is lower, this is because high U.S. productivity has not translated into rising compensation for more than three decades.

Sources: OECD, George R. Tyler, the BLS and The Globalist Research Center

Takeaways

On average, in 2014, Americans spent 1,789 hours on the job.

While output per worker is high, the gains have not been widely distributed in the US.

US workers have higher productivity than Greek workers, generating $66 in GDP per hour on average.

Americans have to work long hours because high productivity has not translated into rising compensation.