For Immediate Release
January 19, 2023

‘Functional Unemployment’ Rises for Latino Workers in December, Wages Down in Q4

Inflation-adjusted wages down overall, but living-wage jobs up, says Ludwig Institute

WASHINGTON, D.C. — Inflation-adjusted wages for Latino wage earners declined 2.4% for the fourth quarter of 2022, with the percentage of Latino workers seeking, but unable to find, living-wage jobs rising from 25.5% to 26.4%, according to a report by Ludwig Institute for Shared Economic Prosperity (LISEP).

The negative trend for Latino wage earners outpaced, and in some instances ran counter to, other demographic groups. Black and White workers saw slight gains in real wages, and those groups also saw growth in living-wage job opportunities.

“Overall, top-line numbers may indicate that wages and living-wage employment is more or less stable, but a deeper dive into the numbers tells a different story,” said LISEP Chairman Gene Ludwig. “Clearly there are segments within the workforce that are losing ground, a situation that must be addressed if we are to head off a recessionary trend and move toward growing a more equitable, sustainable economy.”

LISEP issued its monthly True Rate of Unemployment (TRU) for December in conjunction with the quarterly True Weekly Earnings (TWE) report for the fourth quarter of 2022. TRU is a measure of the functionally unemployed — the jobless, plus those seeking but unable to secure full-time employment paying above the poverty line. TWE is a measure of median weekly earnings after adjusting for inflation, and differs from the data issued by the U.S. Bureau of Labor Statistics (BLS) through inclusion of all members of the workforce, including part-time workers and those actively seeking employment.

LISEP’s TWE report is in stark contrast to an analysis issued by the BLS, which indicates that inflation-adjusted median weekly wages for Q4 trended upward. Unlike the BLS analysis, the entire labor force is considered in LISEP’s number — not just full-time earners. When this is taken into account, real median wages were outpaced by inflation and decreased by 0.4%.

The overall TWE fell from $927 to $923 a week for Q4, in spite of the rate for Black workers remaining steady at $767 a week, and the TWE for White workers rising from $1,019 to $1,022 a week, primarily due to a significant drop in Latino weekly earnings — from $760 to $742. Workers in the lower end of the distribution saw earnings fall more rapidly, with those in the 25th percentile seeing their real wages fall by 0.8% ($589 to $585/week).

A similar pattern emerged with LISEP’s December employment report, with the overall TRU dropping 0.4 percentage points, from 22.9% to 22.5%. All major demographics — with the exception of Latino workers — showed positive trends. The TRU for Black workers dropped 0.5 percentage points, from 26.1% to 25.6%, with the TRU for White workers falling 0.4 percentage points, from 21.6% to 21.2%. The rate for Latino workers jumped nearly a full percentage point, from 25.5% to 26.4%.

“Households across the nation are facing substantial financial challenges, and while many families are holding their own, at best this simply means they are no worse off. Things are just not getting better,” Ludwig said. “Policymakers must be attuned to this growing inequality, which by any measure is unsustainable in a healthy society.”

About TRU

LISEP issued the white paper “Measuring Better: Development of ‘True Rate of Unemployment’ Data as the Basis for Social and Economic Policy'' upon announcing the new statistical measure in October 2020. The paper and methodology can be viewed here. LISEP issues TRU one to two weeks following the release of the BLS unemployment report, which occurs on the first Friday of each month. The TRU rate and supporting data are available on the LISEP website at

About TWE

LISEP issues the TWE quarterly following the release of the BLS Median Weekly Earnings report. The full white paper, “Understanding the Status of American Workers Through Analysis of Current Population Data,” can be viewed here. The TWE rate and supporting data are available on the LISEP website at


The Ludwig Institute for Shared Economic Prosperity (LISEP) was created in 2019 by Ludwig and his wife, Dr. Carol Ludwig. The mission of LISEP is to improve the economic well-being of middle- and lower-income Americans through research and education. LISEP’s original economic research includes new indicators for unemployment, earnings, and cost of living. These metrics aim to provide policymakers and the public with a more transparent view of the economic situation of all Americans, particularly low- and middle-income households, compared with misleading headline statistics.

About Gene Ludwig

In addition to his role as LISEP chair, Gene Ludwig is founder of the Promontory family of companies and Canapi LLC, a financial technology venture fund. He is the founder and CEO of Ludwig Advisors, which counsels financial firms on critical matters. Ludwig is the former vice chairman and senior control officer of Bankers Trust New York Corp. and served as the U.S. Comptroller of the Currency from 1993 to 1998. He is also author of the book The Vanishing American Dream, which investigates the economic challenges facing low- and middle-income Americans. On Twitter: @geneludwig.


Jim Gardner
(573) 680-1822