A report by the National Employment Law Project, released in November 2014, concluded that factory wages have stagnated. Factory workers today earn less in comparison to workers in other types of jobs than their counterparts did in the past.
In the past, factory wages were significantly higher than average earnings in the United States. However, data from 2013 shows that today's factory wages are on average 7.7 percent lower than the national median wage. The National Employment Law Project report drew this conclusion by analyzing data from the United States Bureau of Labor Statistics, as well as census data and information from other sources.
The median wage for a factory worker was just $15.66 in 2013. In comparison, the inflation-adjusted median factory wage in 2003 was $16.38, which means that today's factory workers are losing out by nearly $1.00 per hour compared to their counterparts from 10 years ago. For a full-time factory worker, this drop in hourly factory wages translates to a loss in income of roughly $2,000 every year.
The failure of wages to keep up with inflation is worse in the manufacturing sector than in other industries. The inflation-adjusted drop in factory wages over the last decade is nearly three times higher than the average across all sectors of the economy. The auto manufacturing industry has been hit particularly hard, with workers on automobile production lines losing out even more than other factory employees. Temporary manufacturing workers are at the bottom of the pile, with an average wage that is 29 percent lower than workers who hold permanent positions in auto manufacturing. Factories are using more temporary workers than at any time in the past.
The perception that manufacturing jobs are highly paid persists, however, which could be due to opportunities opening up for a relatively small number of well-paid, highly skilled manufacturing workers. However, the average factory wage is dragged down by the huge number of lower-paid employees. More than a quarter of those employed in the manufacturing sector earn $11.91 or less for every hour they work.
Along with stagnating factory wages, there is further bad news for manufacturing workers. Although the U.S. manufacturing industry is expanding, there is little increase in the number of manufacturing jobs. Automation has allowed factories to ramp up their production while hiring fewer workers. Although automation reduces costs for factory owners, it also means that opportunities for a career in manufacturing are stagnating.
After being hit hard by the economic downturn, the U.S. manufacturing industry has shown strong signs of recovery in the last couple of years. However, this success is tempered by stagnating factory wages and by poor growth in the number of jobs in the manufacturing sector.
Photo courtesy of Gualberto107 at FreeDigitalPhotos.net
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