April 14, 2015
Even in Nursing, Men Earn More
The nursing profession is predominantly women, but it’s the male nurses who earn more – $5,148 more per year on average.
“Male RNs out-earned female RNs across settings, specialties, and positions with no narrowing of the pay gap over time,” according to a salary comparison from 1998 through 2013 in the Journal of the American Medical Association. Other research has revealed pay gaps in teaching, another women-dominated profession.
Today is Equal Pay Day, and the media is replete with reminders that American women earn 77 cents for every dollar that men earn. Nursing is the single largest profession in the growing health care sector, and the pay gap affects some 2.5 million women employed in a profession established in 19th century London by Florence Nightingale, who wrote “Notes on Nursing: What It Is, and What It Is Not.”
The importance of a woman’s earnings level goes beyond the obvious implications for her current standard of living. Earnings are also key to how much she can accumulate over a lifetime.
The largest pay disparity is for nurse anesthetists: men earn $17,290 more than their female counterparts. The only category in which women out-earn – by $1,732 – is university professors in the nursing field. The researchers isolate the role a nurse’s sex plays by controlling for demographic characteristics such as education level, work experience and other factors that also influence how much someone earns. Only about half of the gap between men and women was explained by these identifiable factors, leaving half unexplained.
The chart below shows pay gaps, by type of nurse specialty.
April 9, 2015
Retirement Coverage Expanded: UK vs US
President Obama signed a January memo officially launching his MyRA program to encourage saving by low-income and other Americans who lack a retirement plan through their employers.
The United Kingdom is also addressing pension shortfalls for uncovered workers in a much more ambitious way. The U.K. program, put in place in 2012, has two key provisions that MyRA lacks: it automatically enrolls workers so more will save in the first place, and it provides them with matching contributions.
The U.K. program has enrolled 1.8 million of the 4 million workers targeted, primarily at small employers. A 2014 study by the Center for Retirement Research, which supports this blog, described the program and compared it with MyRA.
The United Kingdom’s retirement income problems largely stem from the contraction of the government’s retirement system. A first stab at improving retirement income security came in 2001, when the government mandated that employers with five or more workers offer a low-cost retirement savings plan that workers could volunteer to join. That program gained little traction among workers or financial firms.
The 2012 reform was much bolder. In addition to mandating a 3 percent employer match (starting in 2017), the government matches 1 percent, with both matches contingent on the employee saving 4 percent of his earnings. To manage the program and offer a low-cost savings plan to employers, the National Employment Savings Trust, or NEST, was established. …Learn More
March 10, 2015
9 Measures of U.S. Economic Inequality
The interactive chart above illustrates the increasing U.S. disparity over the past 50 years between how much wealth the rich own – shown on the right side of the chart – and everyone else on the left.
The vast majority of Americans build wealth week by week, saving a little bit of their paychecks. Workers set aside wealth in less obvious ways too, by contributing some of that paycheck to Social Security and possibly paying down a mortgage.
Differences in earnings add up over a lifetime and contribute to how much wealth people are able to accumulate. This is explored in the Urban Institute’s series of nine charts, including the one above. Take the earnings trend over a half century shown in Chart No. 2 on the Urban Institute’s website: the nation’s top-paid workers have enjoyed increasing incomes, while wages have essentially been flat for those at the bottom. [All income and wealth data are in constant 2013 dollars and are comparable.]
The charts, when taken together, also illustrate how much larger is the wealth disparity between the top and bottom than is the earnings disparity. This is especially true of racial inequalities, even when the researchers control for income and age.
In Chart No. 5 on the Urban Institute’s website, the total value of the lifetime earnings of the typical white baby boomer born between 1943 and 1951 is $2 million – 30 percent more than African-Americans’ lifetime earnings of $1.5 million.
The typical white American families’ retirement savings (Chart No. 7) is $130,472 – seven times more than African-American families at $19,049. [Wealth data were provided only for families, not for individuals.] A report by the Federal Reserve Bank of St. Louis reached similar conclusions about the income and wealth gaps for black families.
To see all nine of the Urban Institute’s charts and its report, click here.Learn More
January 27, 2015
Inequality Fuels Drop-Out Rate
Education is the holy grail of success. But too many young men in this country don’t graduate high school, much less aspire to a college degree.
It’s clear that completing high school improves one’s chances of moving up the economic ladder. So why doesn’t this incentive always work?
At a time of greater attention to the nation’s widening inequality, new research supports the argument that income inequality may actually discourage disadvantaged low-income teenagers from finishing high school.
The study examined whether there is a relationship between inequality and the drop-out rate, measuring inequality as the ratio of the lowest incomes in each state – the bottom 10 percent – to incomes in the middle. The study found that drop-out rates for teenage boys in states with the greatest inequality were 4.1 percentage points higher than drop-out rates in the states with the least inequality – this is a big difference, amounting to more than one-third of the 11.1 percent average drop-out rate. …Learn More
January 20, 2015
Errors in Medical Bills Are Rife
Ever try to make sense of a medical bill, with its co-payments, cost-sharing, and government or insurance-company reimbursements that haven’t been paid yet? Hospital stays with multiple doctors and lab tests make billing even messier.
These layers of complexity contribute to errors and confusion that can damage Americans’ credit ratings. Consumers “incur medical debts in collection without certainty about what they owe, to whom, when, or for what,” the federal Consumer Financial Protection Bureau (CFPB) reports.
When a hospital or physician hasn’t been paid, they may, after trying to resolve the issue in-house, pass the unpaid bill to one or a series of collection agencies. Yet nearly one in four of the complaints consumers have made to CFPB about medical bills in collection said the debt “is not mine.” One in five said they’ve paid the bill being reported as past due.
There’s new evidence that the number of people reporting medical debt issues is declining, and new federal rules are aimed at curbing aggressive collection practices for low-income patients. But medical debt still accounts for half of the collections posted on credit reports and is the largest source of complaints about credit reports, exceeding complaints about utility and cable bills and retail and financial transactions. …Learn More
January 13, 2015
Americans Cope with Income Swings
A full-time job that delivers a steady paycheck, week in and week out, is a luxury for many working people.
Low- and middle-income adults are instead often whipsawed by wild swings in their incomes, finds a U.S. Financial Diaries project, based on detailed biweekly or monthly financial interviews with 235 urban and rural U.S. households nationwide. During the course of the year these interviews were conducted, the average household experienced four spikes or dips, defined as a change of at least 25 percent in their incomes.
The Bloomberg video above explains that even when workers’ annual incomes are sufficient to cover annual expenses, these month-to-month fluctuations complicate how – or whether – they can save for their future.
The income swings have many causes primarily stemming from the labor market, including unpredictable work schedules, unsteady part-time or self-employment, and a patchwork of multiple jobs, as well as a reliance on intermittent payments such as tax refunds. More than half of the adults interviewed – retail and construction workers, waitresses, check cashers, hotel workers, taxi drivers – held down more than two jobs. …Learn More
December 11, 2014
Widows Face More Financial Adversity
Two times more widows than widowers say their spouse’s death carried significant negative financial consequences during the first year after their loss.
This sharp contrast recurred in numerous financial questions recently posed to widows and widowers by New York Life. The contrast also seemed to persist across various income levels, in questions revolving around both essential needs and luxuries. Here’s a sampling of answers given by nearly 900 Americans whose spouses have died sometime in the past decade:
Their answers beg the question: Why the divergence?
One reason is certainly that two-thirds of the widows surveyed reported their income was under $35,000, while a majority of the widowers earned more than that. Adults over age 18 were canvassed, so working women’s lower earnings no doubt contributed to the income and lifestyle disparities.
Pension survivor policies also play a role, since two out of three of the people surveyed were over age 65. …Learn More