Corporations Have Captured 88% Of All Post-Recession Income Growth
Economists at Northeastern University have found where the money that once went to company employees has gone.
A new study released by the school shows that "corporate profits captured 88 percent of the growth in real national income while aggregate wages and salaries accounted for only slightly more than 1 percent" of growth.
The New York Times reports:
The study said it was “unprecedented” for American workers to receive such a tiny share of national income growth during a recovery ... The share of income growth going to employee compensation was far lower than in the four other economic recoveries that have occurred over the last three decades, the study found.
Read more: http://articles.businessinsider.com/2011-07-02/markets/29994002_1_national-income-recovery-net-job-growth#ixzz215fNIeLM
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Wages for workers who never lost jobs have declined in a real sense.
There's a lot that's wrong with this picture, but it is not a simple one. The employment-population ratio tells the tale that the official stats don't:
The long steep rise of the employment population ratio that began in the later 70s was caused mostly by the entry of women into the US workforce.
And the emp/pop ratio ought to be declining now, but slowly. It fell out in the recession and has not recovered.
Worker's shares of incomes cannot recover until the employment slack is picked up, and in many ways the economy won't recover until workers' incomes recover.
Obama's reelection difficulties really have mostly to do with this graph:
An even worse story appears when you look at this graph:
The above graph is number of full-time jobs, so of course the number rises with time as the population expands. Never, since the GD, has the US seen a situation in which the number of full-time jobs has not at least reached pre-recession levels so long after the recession's end. We are almost at 2001 levels of full-time jobs, rather than at 2007 levels.
This all amounts to massive, massive labor slack and low aggregate worker real incomes.
It is not that worker compensation hasn't begun to rise again, as more people got back to work:
The 88% figure is meaningless, because of course most the gains went to the companies - they bore most the losses!
But corporate profits are now on the downturn, and it appears that the next recession may already have started:
So things aren't going to get much better for workers any time soon!
