Salary gap widens as fat cats leave only crumbs

Salary gap widens as fat cats leave only crumbs

Executive salaries continue to outpace pay for those lower on the totem pole.

Despite the sunny reports of more than 200,000 jobs injected into the economy, and the jobless rate dipping to a post-recession low of 5.3 percent, most workers, including the newly minted scores of post-grads, still see quite a different reality as wage growth and futile bargaining power evades hopeful expectations according to a New York Times report.

It’s not simply a binary example of uneducated versus scholar, its egregious even within the hungry ranks. Since the outset of 2014, median wages all those who have attained a bachelor’s degree have inched upward to 2.7 percent, compared to 2 percent for all workers. But among the top 10 percent of earners, wages are up more than 6 percent regardless of the kind of degree.

“If you want wage growth, you’re going to need a specific set of skills,” said Matt Ferguson, chief executive of CareerBuilder, a recruitment software firm. He adds that simply a college degree will get your foot in the door, but it won’t help with gaining any leverage in wage growth.

It’s more evident in desired fields that demand at least a college degree, sometimes more that pay out more than the national average.

A Bureau of Labor Statistics analysis reveals that the top brass in fields such as art, entertainment and media are paid six times more than then the bottom figures in 2014, compared to four times in 2007. Health care professionals with the fattest pockets now sock away four times what their counterparts earn in the lowest tier, compared with less than three times in 2007.

“Overall employment growth is everywhere, but in terms of wage growth, it’s people making more than $75,000,” said Ahu Yildirmaz, head of ADP Research Institute in Roseland, N.J.

Lawrence Katz, an economics professor at Harvard, aptly calls the phenomenon polarization, which continues to add fodder t0 the escalating argument of income inequality in the United States, as college graduates find themselves forced to take jobs less than what should be expected.

However, those who enter the market with degrees in the fields of science, technology, engineering and mathematics are more immune to the trends.

CareerBuilder conducted a survey and concluded that 37 percent of employers were bringing on college graduates that previously only required a high school diploma.

The great exception to this trend is for holders of degrees in the so-called STEM (science, technology, engineering and mathematics) fields. Studies show that even positions that went to those who specialized in the humanities such as in marketing are being handed to the engineer.

And those coming out of less than elite colleges face tougher prospects, as graduates from top-tier universities only account for a marginal portion of the job market.

“The person coming out of Harvard or Berkeley is doing just fine, pretty much in any major, as long as they have some analytical skills,” Mr. Katz said. “For many graduates of the University of Massachusetts, Boston or a local community college, it’s still a tough job market.”

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