This Article reviews America’s primary economic challenge: wage stagnation. As a result of public policy, workers’ wages have either remained stagnant or declined over the past thirty-five years. This is the trend despite an increase in both real gross domestic product and worker productivity. To understand this trend, the Article begins by presenting two distinct sets of policy decisions that have stifled wage growth. The first set of policy decisions, aggregate factors, is described as causing excessive unemployment and disproportionate growth in executive pay. The second set, which is described as the weakening of workers’ ability to bargain for higher pay, has also kept wages from increasing.
In response to the underlying policies driving this trend, the Authors propose alternative policy decisions that should be taken to create jobs and increase wages, including the introduction of a higher minimum wage, the reformation of labor standards, and the strengthening of workers’ rights to collective bargaining, and others. The Authors also discuss policies that will not be beneficial to reaching full employment and increasing workers’ pay, including corporate tax reform, tax cuts, and deregulation. The Article concludes that the current trend of wage stagnation may be reversed by implementing beneficial policies that prioritize full employment over the accruement of wealth at the executive level, and policies to raise wages to correlate to increased productivity and economic growth.