The failure of today’s economy to generate and sustain decent jobs can be traced to the breakdown in the post-World War II social contract that supported a tandem growth in productivity and wages. From 1945 to 1979 productivity and real wages both grew by approximately two to three percent per year. Figure 1 shows that since then, productivity continued to grow steadily while real wages for high school men remained stagnant and the gaps between productivity growth and college graduates expanded, albeit at lower rates. The same basic pattern has persisted over these years for women high school graduates.
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