Improve economic vitality of businesses and individuals
Indicator 2: Increase percentage of prosperous individuals
Measure a: Median Hourly Wage, Adjusted for Inflation
Description:
The median hourly wage is the middle value of the wage distribution; i.e., half of workers receive a wage higher than the median and half receive a wage lower than the median. The median, which is less sensitive than the mean to extremely high wages, can provide a better measure of wage trends for the typical worker. The indicator is calculated using wage records for those covered under the Unemployment Insurance program.
The median hourly wage is adjusted for inflation using the U.S. Implicit Price Deflator for Personal Consumption so that all years are shown in 2006 dollars. The median hourly wage is the best measure to capture changes in overall workers' wages and the ability of the economy to improve all workers' standard of living. When the median wage increases, it is indicative of wages increasing across the board. An increase in wages for just those in the highest wage jobs would not be revealed in the median wage calculation.
The following graph shows a distinct stalling of wage gains in the aftermath of the 2001 recession. The decline in the median wage in 2004 is indicative of the severity of the economic downturn in Washington state. The economic recovery and expansion is evidenced by gains in the median wage beginning in 2006.
| Median Hourly Wage in 2006 Dollars | ||||||||||||
| 1995 | 1996 | 1997 | 1998 | 1999 | 2000 | 2001 | 2002 | 2003 | 2004 | 2005 | 2006 | |
| Median Wage | $16.44 |
$16.60 |
$16.91 |
$17.42 |
$17.65 |
$17.87 |
$18.53 |
$18.77 |
$18.77 |
$18.54 |
$18.51 |
$18.66 |
Source:
Employment Security Department - Covered Employment and Wages