Technology didn’t depress wages—until it did. The hidden story in one macroeconomic indicator could explain why.
MACRO HERE ’S A MYSTERY: Why is workers’ share of total economic output declining? If you think that’s been happening forever or that the answer is obvious, you’d be wrong. On the contrary, through most of the past two centuries of booms, busts, wars, and technological revolution, labor’s share of GDP stayed remarkably constant (around 65% in the U.S.). That finding, when first unearthed decades ago, surprised everyone. British economist John Maynard Keynes called it “a bit of a miracle.” Nonetheless, it looked like a fact of life—workers’ pay grows with GDP.
But then, of course, it didn’t. Starting in the 1980s, around the world, labor’s share began to fall slowly. In 2000, it began to fall quickly. Labor share is now 56% in the U.S., which translates into some $11,000 less in annual income for the average household than with a 65% share. The decline has been even steeper in some countries, notably Germany, and has occurred also in developing economies, including China, India, and Mexico.
Bu hikaye Fortune dergisinin July 2019 sayısından alınmıştır.
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Bu hikaye Fortune dergisinin July 2019 sayısından alınmıştır.
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