How the Job Market Is Contributing to Income Inequality

It's been ten years since the Wall Street financial crisis, and the rich are still growing richer while the poor continue to grow poorer. Whether Republican, Democrat, or none of the above, income inequality is a deep-rooted economic issue in America.

Unless you are among the top 10 percent taking home 50 percent of the nation’s income, you’re being subjected to unfair—-and sometimes unethical—economic practices. Unfair income differences are a very complex economic problem with many factors attributing to it.

Even if you are you are not from a financially underserved group of people—although there are people suffer from greater income inequality—does not mean that you are not a victim of it. Unless you are already rich, systems have been in place to benefit the wealthy at the expense of the less fortunate. Income biases not only affects you, but it is hurting the overall economy, further corrupting our political system, and heightening social tension.

It may be easy to discount and overlook income disparities because it is an incredibly complicated issue, and it may be easy to not believe it is happening to you. However, you are not exempt from falling prey to income inequality, and in many instances, you have already been taken advantage of.

Governmental Regulations (Or Lack Thereof)

Bureaucratic procedures and policies have long been in place to favor the rich, and both major political parties are guilty and distributing a disproportionate amount of the nation’s wealth to the top 10 percent. The rich get richer by merely paying politicians to vote for policies that will benefit only them, and often it is the case that these politicians are backed by wealthy lobbyists—saying that they have your best interests in mind, but really are acting on behalf of said wealthier influences.

However, you are likely not a wealthy lobbyist. You do not benefit from tax cuts for the wealthy, deregulations of the financial sector, or the ever decreasing influence of unions who fight for you. In these instances, money has no political affiliation or discrimination. If you are rich, then you will continue to be rich—no matter what color, race, creed, gender, sexual orientation, etc. Where discrimination rears its ugly head—hindering many, especially minorities and women, from becoming rich—is in the job market.

How the Job Market Contributes to Income Inequality

Whether intentionally or self-consciously, it has been proven that employers are not hiring minority and women applicants who have the same (or better) qualifications than nonminorities. Additionally, they tend to pay people of color and women less. The racial and gender disparities are very evident in the job market, and many times these disparities begin before the job hunt even starts.

Lack of funding in urban areas leads to the poor education of mostly minorities. Coupled with the rising cost of higher education, this makes it extremely difficult for a lot of people of color to be considered for a high-paying job. Additionally, there is a technology gap in which lower-income people cannot afford the technology needed to perform today’s job tasks. To make things worse, women are being dismissed for jobs in the tech field.

This is a vicious cycle, as minorities and women are skipped over for job opportunities, creating gaps in their work history that need to be explained to other employers — making it even harder to get a job. However, these aren’t the only prejudices of our job market, though they are the largest that contribute to income disparities.

What We Can do to Combat Income Inequality

Since it is so ingrained, lessening income equality may be a slow going, massive task. However, it is a necessary undertaking. Reducing income inequality will involve reforming economic and educational systems, including higher investments in education and increasing the minimum wage. Also, we must all encourage the desegregation of neighborhoods and schools.

Additionally, the general public needs to push to make our tax code more progressive. Tax cuts that singularly benefit the rich only hurt our economy in the long run. Pushing for a more democratic tax cut that helps everyone will even out how wealth is distributed.

Reducing the differences in income will be a hard task, as many of the politicians who vote on these policies are influenced by equally rich people to keep them rich. However, we voted these politicians in, and we can vote them out to get our economic freedoms back.

Income inequality is very real in the United States. It will just take time and working together to fix these misguided infrastructures to get us all back on track. Understanding the underlying causes of income disparities is the first step in correcting these problems.

By Noah Rue

About the author

Noah Rue is a writer, a digital nomad, an ESL teacher, and an all around good dude, if he doesn’t say so himself.

  • Ramesh Sangare

    Noah, if this the situation in so called developed economy of the world USA, what could be the plight of developing nations in Asia and underdeveloped nations in Africa? This phenomenon is worldwide creating and widening the gap between the Haves and Have-nots! Nice article indeed!
    Ramesh Sangare, President & CEO, HRDC Group, Nagpur Pune (India)

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