American total compensation has grown steadily since the 1970s. Wages have been stagnant because almost all that growth has been eaten up by rising healthcare costs: https://fee.org/articles/dispelling-the-myth-that-wages-have.... That indicates a problem with our healthcare system, not a structural problem with the economy. (Likewise, if you look at returns to capital, they have been stable since the 1950s. The decrease in returns to labor have come entirely from increasing returns to real estate. Again, that’s a problem with housing markets—specifically, over regulation of housing—not the economy itself.)
Using the 1970s as a baseline also dramatically skews the numbers. 1970 was a local minimum in terms of the percentage of the population that is immigrants (under 5%). Today it’s almost 15%. Even in a healthy economy, new immigrants aren’t going to be doing as well as the native born right off the bat. A growing immigrant share of the population is going to cause median wages to seem stagnant even if they’re going up within each demographic.
1. Your citation is from a right-wing libertarian think tank. It is apparent from the analysis that the author is selectively choosing an explanation and back fitting the data.
Using the 1970s as a baseline also dramatically skews the numbers. 1970 was a local minimum in terms of the percentage of the population that is immigrants (under 5%). Today it’s almost 15%. Even in a healthy economy, new immigrants aren’t going to be doing as well as the native born right off the bat. A growing immigrant share of the population is going to cause median wages to seem stagnant even if they’re going up within each demographic.