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If you use westegg inflation calculator, $6.00 in 1970 would now be the equivalent of about $36.00. But you're right wages have not kept up with inflation. My dad started teaching in 1971, making $7,000 as a first year teacher. If that number followed inflation a first year teacher in district would today be making $40,000. Unfortunately first year teachers in his district make a little over $30,000 to start.
The one price that always sticks out to is gas prices when compared to inflation. I graduated from high school in the late 90s and remember gas prices always hovering around $0.93 / gallon. If that price had followed inflation gas prices would be around $1.31 / gallon.
Lastly, I'll point out that out of high school I worked as dock worker at a grocery warehouse in the summer of 1999 making $10.00 / hour. Great work and money for an 18 year old kid at the time. If you look around the country for similar jobs (i.e. picker / packer, standing forklift driver, etc....) those jobs still only pay anywhere from $8.00 / hour to $11.00 / hour. Inflation says those jobs should be paying $14.00 / hour.
Unfortunately there are a multitude of variables that influence prices and wages.
You are right. I remember in 1999-2000 gas in New York was about $0.99 per gallon during summer, now it is about $2.79. That is double the inflation rate (but gasoline is subject to a lot of economic variables.) The biggest issue I see is we have a situation similar to the 1970's with stagflation where costs for gas and food are going up YET we don't see wage growth to keep up with it.
1. The amount genx, geny and millennials spend on cell phones and computers I find simply staggering. It isn't unusual to find someone earning $8.00/hour yet spending $100/month of that on a stupid cell phone.
2. They see easy money, lucky money really, made by a few and somehow they feel they are entitled as well. The sense of entitlement is staggering as well. Say I earn $35.00/hour and to tell the truth I don't work hard at all. Snowflake over there works hard at Wal-Mart for $12.00/hour and you listen to him he feels he should get more than I do simply because he works harder.
So, my precious little tigers, we never really did have it as good as some of you like to think we did.
This is interesting and I definitely appreciate your perspective, however, the reason younger generations feel entitled is because most have spent/borrowed $40,000+ for a college education with the promise (almost an unspoken guarantee) of a job with a salary that will pay off those student loans. This hasn't happened. Do you have a college degree? If so, how much did it cost? ...that's what I thought.
Is it the younger generations fault that they feel entitled when all of society was telling them they won't be able to get a job at all without a college degree? Do you have children? Did you encourage them to get college degrees? You can't earn a proper living without one, and yet when you earn/buy one - you're no longer guaranteed a job. That's a precarious position to be in. Also, sadly you cannot have a job without a cell phone + internet. It's impossible in this day and age.
This is interesting and I definitely appreciate your perspective, however, the reason younger generations feel entitled is because most have spent/borrowed $40,000+ for a college education with the promise (almost an unspoken guarantee) of a job with a salary that will pay off those student loans. This hasn't happened. Do you have a college degree? If so, how much did it cost? ...that's what I thought.
Is it the younger generations fault that they feel entitled when all of society was telling them they won't be able to get a job at all without a college degree? Do you have children? Did you encourage them to get college degrees? You can't earn a proper living without one, and yet when you earn/buy one - you're no longer guaranteed a job. That's a precarious position to be in. Also, sadly you cannot have a job without a cell phone + internet. It's impossible in this day and age.
Very good points that I agree with because I live with them BUT the people you are trying to debate typically either don't want to hear it or don't care. They live in their bubble and don't realize the way the world works now. When I was jobless, my father didn't know what I was doing wrong with interviews that I would get them but get no response. In actuality, the only thing I did "wrong" in many cases, is NOT be better than the best candidate (which is hard when you don't have any clue what other candidates are doing in their interviews.)
Is it the younger generations fault that they feel entitled when all of society was telling them they won't be able to get a job at all without a college degree? Do you have children? Did you encourage them to get college degrees? You can't earn a proper living without one, and yet when you earn/buy one - you're no longer guaranteed a job. That's a precarious position to be in. Also, sadly you cannot have a job without a cell phone + internet. It's impossible in this day and age.
The way I set college up was I paid for nearly all of it but they HAD to get a student loan in the amount of $2,500 every year so they would have skin in the game too. It went like this; you pay $2,500 in borrowed money and dad will pay everything else in addition to giving spending money which cost dad $20,000/year. I paid for books, the car expenses, all tuition except for $2,500, an apartment with all utilities and $100/week spending cash. In exchange I got to have some say in what courses they wanted to pursue because I often said "I don't care what you want to do but for me to pay my money you have to prove to me you can get a job and support yourself because when school is done so am I."
Then I find out years later mommy is sending $50 to $100/week in addition to what I sent because she didn't want her precious babies to go without. Her babies lived better than I did!
Now, if they wanted that degree in Advanced Puppetry I was fine with it but it wasn't going to be with my money.
Another rule is you had to go at least 100 miles away to school and live in a dorm the first year and an apartment the remaining years. Reason for this is I wanted to make it extremely hard for them to quit school... to quit school and take the easy way was going to require them to upend their whole life and that is what I wanted.
Another rule is no work during the school year, it was full time school and school was your job so do it well.
There are a lot of problems with such comparisons, with inflation of some items being way off and others not so much. My first new car cost $2,500 in 1973, the one we bought most recently cost $28,000. Milk in 1970 was about $1.30, now just a little over $2. I was making $3/hour, while in college 1970-74, no benefits, often more than 40 hours a week without overtime pay since there was no law requiring it then. My rent was $150 for a two bedroom apartment, car payment $73,
graduated and went to graduate school with no student loan debt. When it comes to wages, you cannot simply apply inflation to them and project what they "should be" now. Wages have always been based on the value of the work to the employer, and how much they have to pay to attract people, while maximizing their profit to stay in business and make a comfortable living, and/or satisfy the shareholders. How much the employee is in debt, has to pay for student loan debt, or the cost of housing has never been the employer's problem.
Inflation counts some products and not others. it's an index but it isn't perfect. some things like housing that should be included aren't, and housing has a big big effect on spendable income- especially when housing prices were skyrocketing leading up to the crash.
But to your points:
1.) cars are a LOT more expensive than they were in the 60s and 70s, even taking inflation into account. But in the interim the government has mandated a lot of safety and efficiency standards on cars that didn't exist back then that definitely jack prices up. Modern cars are designed to crumple on impact to protect the wearer, have seatbelts for all passengers, incorporate airbags and frequently side airbags, antilock brakes, rollover prevention, cruise control, tire pressure monitors, have technology designed to reduce emissions and are required to hit drastically better gas mileage- all while your average 4 door sedan cranks out horsepower ratings that would embarrass a 1960s mustang. All of that doesn't come cheap.
2.) The price of milk is kept artificially where it is by the US government, so inflation isn't applicable to it.
3.) as mentioned before, Rent and Housing are astronomically higher than they were back then, though this can vary based on region. A month's rent single bedroom in the san francisco area goes for close to $3000.
4.) you certainly *can* apply inflation to the cost of goods (though not housing, see above) and project where wages "should" be, this is exactly how they determine what amount social security pays, and how they determine where minimum wage should be set every 7-8 years or so. Granted, this figure is going to vary due to cost of living, but federal minimum wage is always a lowball, and states and municipalities can and do raise this figure higher when necessary. Somehow there never seems to be a wave of employers going out of business every time minimum wage goes up nationally or locally- why do you think that is?
$6 an hour in 1970 was really good money when most jobs paid $1.25 an hour. Gasoline was 25 cents a gallon. You could go in and see the doctor for $25 and that included the bloodwork.
I had friends renting a house for $25 a month. I bought acreage in one of the most expensive zip codes for $9,000.
A better argument is that you needed less skills to earn a decent wage in 1970. There were people who got paid good living wages to tighten bolts in assembly lines. Nowadays, in most warehouse/factory settings, you need to know how to drive a forklift or at least work an electric pallet jack to make at least $14 an hour. Also, the higher paying warehouse/factory jobs that don't require much skill often involve working in very cold or very hot environments that require much strenuous activity; which is the reason for the high turnover rate at such jobs. I was at a temp agency earlier today and overheard a truck driver being paid $17 an hour to start, but I was offered only a flat rate of $10 an hour for a few different jobs to start because I only have basic picking and packing warehouse experience. Not to mention I worked for $10 an hour over ten years ago when gas and everything else was much cheaper. Back in 2003, ten dollars filled up my gas tank from a quarter to full in an Acura sedan that only ran on premium unleaded. Today, it takes $30 to do the same in a similar sized Toyota sedan that takes regular.
Location: East of Seattle since 1992, 615' Elevation, Zone 8b - originally from SF Bay Area
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Quote:
Originally Posted by Burger Fan
Inflation counts some products and not others. it's an index but it isn't perfect. some things like housing that should be included aren't, and housing has a big big effect on spendable income- especially when housing prices were skyrocketing leading up to the crash.
But to your points:
1.) cars are a LOT more expensive than they were in the 60s and 70s, even taking inflation into account. But in the interim the government has mandated a lot of safety and efficiency standards on cars that didn't exist back then that definitely jack prices up. Modern cars are designed to crumple on impact to protect the wearer, have seatbelts for all passengers, incorporate airbags and frequently side airbags, antilock brakes, rollover prevention, cruise control, tire pressure monitors, have technology designed to reduce emissions and are required to hit drastically better gas mileage- all while your average 4 door sedan cranks out horsepower ratings that would embarrass a 1960s mustang. All of that doesn't come cheap.
2.) The price of milk is kept artificially where it is by the US government, so inflation isn't applicable to it.
3.) as mentioned before, Rent and Housing are astronomically higher than they were back then, though this can vary based on region. A month's rent single bedroom in the san francisco area goes for close to $3000.
4.) you certainly *can* apply inflation to the cost of goods (though not housing, see above) and project where wages "should" be, this is exactly how they determine what amount social security pays, and how they determine where minimum wage should be set every 7-8 years or so. Granted, this figure is going to vary due to cost of living, but federal minimum wage is always a lowball, and states and municipalities can and do raise this figure higher when necessary. Somehow there never seems to be a wave of employers going out of business every time minimum wage goes up nationally or locally- why do you think that is?
In our state it's gone up every year, but only 15-20 cents a year isn't going to hurt much. In the last 18 years it has not even doubled. The instant doubling of the federal from $7.25 to $15 that people want would definitely impact a lot of businesses. Here in Seattle even before that $15 amount is reached, just based on the first year step there has been an impact on business.
Washington State Historical Minimum Wage
Effective dateMinimum wage per hour January 1, 2015 $9.47 January 1, 2014 $9.32 January 1, 2013 $9.19 January 1, 2012 $9.04 January 1, 2011 $8.67 January 1, 2010 $8.55 January 1, 2009 $8.55 January 1, 2008 $8.07 January 1, 2007 $7.93 January 1, 2006 $7.63 January 1, 2005 $7.35 January 1, 2004 $7.16 January 1, 2003 $7.01 January 1, 2002 $6.90 January 1, 2001 $6.72 January 1, 2000 $6.50 January 1, 1999 $5.70 (September 1, 1997) $5.15
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