May 18, 2024

News and Political Commentary

High-paid Americans are working less hours than before the pandemic

2 min read

With the unemployment rate near a 50-year low and businesses hiring left and right, it would seem the American worker is hustling like never before just to keep up with the rising cost of living. 

But not everyone is hustling equally.

According to payroll provider ADP and its Research Institute, the highest-earning workers, as well as young workers and female workers, are working fewer hours than they did before the pandemic. 

The average workweek in 2023 was the lowest in five years, ADP found.

“For significant cohorts of the population, including women, they’re working less now than they did before the pandemic,” said Nela Richardson, chief economist at ADP. “There’s never been more people working in America, and yet, individuals, on average, are working less.” 

ADP tracked 13 million hourly workers who kept the same job for four years ending last December—meaning, the drop in hours wasn’t because people were laid off or switched jobs. And while it’s not clear if workers or employers initiated the drop, the pullback among the highest-paid provides a clue, Richardson said. 

Workers in the highest-paid 25%—those making $79,500 or above—had the largest drop in hours worked. The lowest-paid, on the other hand, are working more.

What’s more, a significant portion of people working fewer hours saw their incomes rise, not fall—indicating that less work isn’t necessarily a bad thing for the budget bottom line. 

“The mixed blessing of those double-digit wage gains [during the pandemic] is some people are able to make the same salary by working fewer hours a week,” Richardson said. “We think this is a complication of the fact that some people experienced higher wage gains, and also had more flexibility to design their own schedules.”

“If you make a median $80,000 a year … for the most part you’re not in the leisure and hospitality sector,” she said. “You might be a knowledge worker, and that…

Irina Ivanova

2024-02-24 09:08:00

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