Income inequality in Wisconsin is widening, according to a new report by the Center on Wisconsin Strategy (COWS) and the Wisconsin Budget Project. The top 1% of earners in Wisconsin have experienced tremendous gains in average income in recent decades, while incomes for the bottom 99% have declined.
Key findings of the report include:
- Between 1979 and 2011, the average income of the top 1% in Wisconsin grew by 104%, while the average income of the bottom 99% dropped by 0.4%.
- The top 1% in Wisconsin had an average income of $783,000 in 2011, more than 18 times the average income of the bottom 99%.
- In 2011, 15.7% of income went to the top 1% in Wisconsin, a share that has more than doubled since the 1970s.
Over the last hundred years, income inequality has followed a U-shape in Wisconsin, with very high levels of income inequality during the 1920s and 1930s, much lower levels in the middle part of the century as economic gains were made at all income levels, and then climbing again to very high levels. Read more
State and local policymakers in many parts of the country are coming to the conclusion that too many workers get paid too little, and they are pushing for higher wage standards for workers. Yet in Wisconsin, lawmakers are moving in the opposite direction.
A balanced budget amendment in the U.S. Constitution would result in much longer and deeper recessions and would cause unnecessary job losses. When the economy goes into a dive and people are without jobs, the need for food stamps, health insurance and unemployment insurance rise sharply. Since tax revenue typically falls as the need for those programs rises, a balanced budget would require cuts to these safety net programs and other areas of spending at the worst possible time.
A big jump in state revenue that will be announced soon gives lawmakers an excellent opportunity to invest in Wisconsin’s economic future and to put the state on a sounder fiscal footing by filling budget holes.
A total of 13 states welcomed in the New Year Wednesday with minimum wage increases – thanks in many cases to formulas that automatically adjust it for inflation. Washington State leads the way, with the nation’s highest state minimum, which is now $9.32 an hour (compared to the federal minimum of $7.25). A 14th state, California, will also increase the minimum wage this year – to $9 per hour, but not until July.
According to an analysis by the National Employment Law Project (NELP), the minimum wage increases that took effect today directly benefit over 1.4 million people — 1,441,000 to be exact. An additional 1.1 million are expected to benefit as employer pay scales are adjusted upward to reflect the new minimum wages. A number of additional workers will benefit from local increases.
Federal Lifeline for the Unemployed Ends Dec. 28th, but the Debate Will Continue
Federally funded unemployment insurance benefits, known as emergency unemployment compensation (EUC), will expire at the end of this week. However, the debate on this issue will continue into 2014, as Senate Democrats seek an opportunity to restore the EUC program. (See, for example, this article about Senator Reed’s proposal.)
Here are ten key things to know about the EUC program, which expires on December 28:
1) The maximum length of unemployment insurance benefits will immediately drop to the 26 weeks of state benefits, which is slightly less than half the current limit in Wisconsin of 54 weeks of combined state and federal benefits. (That has already been reduced from a maximum of 99 weeks during the worst of the recession.)
If Congress does not act, jobless workers in every Wisconsin county will miss out on federal support targeted at helping individuals who have been searching for a job for a long time, according to a new analysis from the Wisconsin Budget Project.
At the end of the year, federal unemployment benefits are slated to end. The result is that 99,000 unemployed Wisconsin residents will lose an estimated $361 million in assistance in 2014.
Today’s new Wisconsin Budget Project analysis shows the economic downside to ending federal unemployment benefits, with estimates that describe how jobless workers in each county would be affected. Here are some examples:
- In Milwaukee County alone, nearly 26,000 individuals who have been searching for a long time will miss out on $93.8 million worth of assistance for the long-term unemployed, unless Congress acts;
- In Marathon County, 2,800 individuals will miss out on $10.1 million in assistance; and
- In Fond du Lac County, 1,500 workers will lose out on $5.4 million in assistance.
Employers in Madison may no longer discriminate against unemployed workers when making hiring decisions, thanks to a new policy passed by the city council.
Job seekers who have been out a job for weeks or months face a difficult situation: They want a job, but companies often won’t hire people who have been unemployed for an extended period. In other words, the unemployed can’t get a job because…they don’t have a job. Individuals caught in this jobless Catch-22 face a difficult climb back to employment.
New research sheds a light on just how severe the discrimination against the unemployed is in the job market. This Wonkblog article in the Washington Post describes how a researcher sent out thousands of fictional resumes for job openings and measured the responses. “What he found is that employers would rather call back someone with no relevant experience who’s only been out of work for a few months than someone with more relevant experience who’s been out of work for longer than six months.”
The issue of discrimination against the unemployed is especially pertinent right now due to the large numbers of people who have been searching for a job for a long time. Read more
Minnesota releases updated revenue and spending projections in early December of each year, and the new figures released today are very positive – a net gain in the Minnesota budget balance of about $1 billion. Let’s hope that Wisconsin can come close to matching that when our new tax and spending estimates are released in late January or February.
As we noted in a blog post about two weeks ago, many people across the country are watching Minnesota and Wisconsin carefully because of the very different directions that the two states have gone in fiscal and health care policy over the last couple of years. Because of the many demographic similarities between the two states, the divergent choices by policymakers set up an interesting experiment. In that context, today’s budget news from our neighbor to the west could be an early point in their favor, but we won’t have any basis of comparison in Wisconsin for another month or two. Read more
Thousands of out-of-work Wisconsinites who have been searching for a job for a long time will lose their unemployment benefits at the end of the year, unless Congress acts to renew federal unemployment benefits. According to a new analysis from the Wisconsin Budget Project, 65,500 jobless workers in Wisconsin will lose access to federal benefits over the next six months, as shown in the chart below.
Most states pay unemployment insurance benefits to jobless workers for a maximum of 26 weeks. In times of higher unemployment, Congress authorizes federally-funded benefits that provide assistance to people who reach the limit on their state-financed unemployment insurance. If the program that provides federal unemployment benefits is allowed to end, the maximum duration of unemployment benefits for jobless workers in Wisconsin will drop by more than half, from 54 weeks to 26 weeks.