[lbo-talk] Fitch and Brenner

Matthias Wasser matthias.wasser at gmail.com
Mon Feb 23 11:10:11 PST 2009


On Mon, Feb 23, 2009 at 2:02 PM, Doug Henwood <dhenwood at panix.com> wrote:


>
> Sure they have. There are some problems with using the wage & salary
> figures from the NIPAs. One is that the aggregate measure includes fringe
> benefits, which accrue mainly to the top half of the income distribution.
> And another is that they include managerial pay, most of which is
> conceptually a return to capital rather than a pure wage. And a third is
> that the W&S total includes public sector workers. A proxy for working class
> earnings in the private sector can be computed by multiplying the average
> weekly wage times the number of production workers times 52. That measure
> peaked at 30.2% of GDP in 1972. It fell raggedly through the rest of the
> 1970s, to 27.6% in 1979, when Volcker took office. It fell to 23.1% at the
> 1990 peak, and stayed fairly steady through the 1990s - *despite an
> acceleration in productivity growth*. It then resumed falling after 2000, to
> 20.9% last year.
>
> The last expansion saw a massive increase in profits, and a minuscule one
> in labor income.
>
>
Don't we want to be measuring private sector wages against profits, not total GDP?



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