Commentary: Why are workers feeling so stressed? Maybe because labor's share of the economy is at a record low

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Set us as preferred There was a brief moment at the tail end of the pandemic, already forgotten, at which it seemed that American workers had finally grasped the reins of power, with wage gains rising and organizing strength entering a new era.The moment is forgotten today because whatever leverage labor thought it had acquired evaporated rapidly.And recently it has been scraping along the bottom.

Just this month, the government reported that labor share—”the fraction of economic output that accrues to workers,” as the Bureau of Labor Statistics defines it—reached 52.8% in the second quarter of this year.That’s the lowest level the BLS has recorded since it started taking the measurement, in 1947.Social and economic justice remain a struggle for the political power that creates the opportunity for a fairer distribution of our economy’s prodigious wealth, income, and most importantly, opportunity.— Former Biden economic adviser Jared BernsteinThe labor share is a symptom of worker anxiety, of course, not the cause.

But as a symptom it speaks volumes.It reflects growing wealth inequality, a tax system that comes down hard on wages but gives capital earnings a pass, an explosive growth in corporate profits and a shift of employment from large-scale manufacturing to gig-provided services.

Juxtaposing the labor share with corporate profits tells the full story: Since the first quarter of 2001, according to the BLS and the Bureau of Economic Analysis, after-tax corporate profits have risen nearly eight-fold while the labor share has declined by nearly 18%.Commentary on economics and more from a Pulitzer Prize winner.By continuing, you agree to our Terms of Service, which include arbitration and a class action waiver.

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