Workers are getting a shrinking slice of America’s economic pie
- The labor share of income fell to 52.8% earlier this year, marking the lowest level recorded since 1947, according to Bureau of Labor Statistics data.
- Goldman Sachs economist Abhay Duggirala attributed 40% of the decline to tax laws and depreciation, while the remaining 60% stems from higher markups, industry concentration, and automation.
- In an economy generating $23.6 trillion, EY-Parthenon chief economist Gregory Daco noted a return to 56% labor share would translate to a $3,900 boost per household.
- Navy Federal Credit Union economist Heather Long warned this dramatic change fuels populism and affordability concerns, as workers possess less bargaining power in this technology age.
- JPMorgan chief US economist Michael Feroli projects the labor share could fall below 50% by the end of the decade, as workers may not reap many financial benefits from AI.
14 Articles
14 Articles
American Workers Are Getting The Smallest Share Of Economic Output In Nearly 80 Years. AI Could Make It Worse.
Economists are divided over how much of the long-term decline reflects weaker bargaining power, automation and changes in how business income is recorded.
Economists debate what the falling US labor share reveals
Workers' share of American economic income has fallen to 52.8%, the lowest reading in Bureau of Labor Statistics records dating to 1947. The figure sharpens a question that headline growth cannot answer: how much of an expanding economy reaches households through their paychecks? A rising economy and an improving household budget are not interchangeable achievements. When compensation captures a smaller proportion of output, stronger production …
Workers are getting a shrinking slice of America’s economic pie
By Alicia Wallace, CNN (CNN) — The US economy continues to grow at a relatively healthy pace, but American workers aren’t fully reaping the financial rewards.In fact, American workers’ piece of the economic pie is shrinking. By one official measure, their slice is the smallest in almost 80 years.The labor share of income, which is
The US economy continues to grow at a relatively healthy rate, but American workers do not fully reap the financial benefits. In fact, the share of American workers in economic pie is shrinking. According to one official measure, their share is the lowest in the last nearly 80 years, CNN reports. Workers have increasingly less power [...]
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