Labor Market Trends and Outcomes: What Has Changed since the Great Recession?

This article describes 40 years of trends in wages and labor force participation for the “working class”—workers with a high school education or less—compared to workers with a college degree or more. We compare cyclical peaks over the entire period 1979 to 2019, with particular focus on the Great Recession (2007–2010) and recovery (2010–2019). We also present results by gender and race. We find real wage growth for all workers in the recovery from the Great Recession, but not enough to change the long-term trends of growing inequality and stagnant wages for the less educated. We also find that labor force participation continued to decline for the less educated, even during the recovery. Gaps between whites and Blacks grew, while Hispanics and Asians made more progress than Blacks. We consider various explanations for these findings and show that the early effects of the 2020 to 2021 pandemic recession hurt less-educated workers and those of color more than anyone else.