Sunday, September 13, 2015

Corporations are putting a $535 billion squeeze on workers' share of the pie

The wage squeeze is not in workers' imaginations. The Economic Policy Institute's Josh Bivens explains:
Between 2000 and the second quarter of 2015, the share of income generated by corporations that went to workers’ wages (instead of going to capital incomes like profits) declined from 82.3 percent to 75.5 percent, as the figure shows. This 6.8 percentage-point decline in labor’s share of corporate income might not seem like a lot, but if labor’s share had not fallen this much, employees in the corporate sector would have $535 billion more in their paychecks today. If this amount was spread over the entire labor force (not just corporate sector employees) this would translate into a $3,770 raise for each worker.
And by the way, American corporations were doing just fine back when they weren't squeezing quite so hard.


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