Friday, September 6, 2013

paychecks vs. portfolios; profits back, wages not

Political Economy of the Wage Fight, Jared Bernstein, 8/30/13

Source: BEA (NIPA tbl 1.12)

"As the figure shows, the pattern of recent business cycles is the profit share is pro-cyclical and the comp share, counter-cyclical.  But here's the kicker: note that the profit share doesn't just recover from its cyclical lows; it surpasses them, as it has done already in this recovery, while the compensation share just keeps carving out new lows.  And, for the record, compensation itself has of course become more unequally distributed, so these data present only a partial view of the growing inequality problem.

It's a picture of an economy that has been continuously unforthcoming to those who depend on the paychecks as opposed to their portfolios."

See also his article,

National Jobs for All Coalition