K-12 Tax & Spending Climate: Stagnant Lifetime Earnings

Fatih Guvenen, Greg Kaplan, Jae Song, and Justin Weidner:

The lifetime earnings of the median male worker declined by 10 percent from the 1967 cohort to the 1983 cohort. Further, more than three-quarters of the distribution of men experienced no rise in their lifetime earnings across these cohorts. Accounting for rising employer-provided health and pension benefits partly mitigates these findings but does not alter the substantive conclusions.

How are these changes reflected in wage/salary earnings? When nominal earnings are deflated by the personal consumption expenditure (PCE) deflator, the annualized value of median lifetime wage/salary earnings for male workers declined by $4,400 per year from the 1967 cohort to the 1983 cohort, or $136,400 over the 31-year working period.