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Corporate Profits vs. Worker Compensation. Who Will Win Out? Part II

  • Scott Carmack
  • Jan 8, 2016
  • 1 min read

Updated: Mar 27, 2024

In a prior perspective piece, we tracked corporate profits and worker compensation as a percentage of GDP. We determined that their respective shares of GDP were highly cyclical, and that they generally moved inversely to each other. We noted that worker compensation as a share of GDP topped out in 1970 and has been declining ever since, meanwhile corporate profit share has been increasing. Furthermore, we opined that the reason this has occurred is because there has been a massive supply glut of labor in the United States. We also noted that this oversupply is in the process of reversing and that it is highly likely that compensation, as a percentage of GDP, has bottomed and will increase over the longer-term.



 
 

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