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article imageOp-Ed: The gap between high and low-wage earners in the US

By Ken Hanly     Nov 7, 2013 in Business
There is a growing gap between rich and poor in the US that only seems to increase as the economy recovers from the recession and the stock market reaches new highs.
An article in the Huffington Post has useful breakdowns of the percentage of Americans in specific wage ranges from lowest to highest. The complete report upon which the short article is based can be found at a Social Security Administration site.
A salary ot $27,010 per year marks the federal poverty level for a family of five in 2012. The Huffington Post article points out that this is not far below the $30,000 income that more than half of US wage earners made last year. While this may be significant, in many families there may be several wage earners and that could take those families well above the $30,000 level in total family income.
A figure that struck me was that 15 per cent of the US population earn less than $5,000 a year. Those people must really be struggling to survive, even though no doubt some work "under the table" and do not report income.
An American who earns just $10,000 per year earns more than 24.2% of Americans. Even if you made $15,000 per year which is approximately that of a minimum-wage earner working 40 hours a week, you would earn more than almost a third (32.2%) of Americans.
The top 1% of income earners take in more than $20 million a year and earn more than 99.99989% of Americans. There are 894 people in the 1% of wage earners in this group who collectively receive in total over $37 billion per year. The 166 Americans who earn over $50 million per year have an average yearly income of $97 million.
This data shows "wages" rather than wealth or income from all sources. The definition of wages is: "The national average wage index (AWI) is based on compensation (wages, tips, and the like) subject to Federal income taxes, as reported by employers on Forms W-2. Beginning with the AWI for 1991, compensation includes contributions to deferred compensation plans, but excludes certain distributions from plans where the distributions are included in the reported compensation subject to income taxes. We call the result of including contributions, and excluding certain distributions, net compensation."
The appended video is based upon distribution of wealth not income and shows how Americans' perception of the distribution is hopelessly off base. However, even the perception that they have of the distribution they believe is too much skewed towards the rich.
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This opinion article was written by an independent writer. The opinions and views expressed herein are those of the author and are not necessarily intended to reflect those of DigitalJournal.com
More about income disparity, Social security administration, poverty in US
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