Business owners make their profits from simply owning their businesses. Workers profit by producing value and getting compensated for a portion of the value they produce - the rest going to business costs and owners. Why would higher worker productivity translate to higher compensation? Owners don’t part from their extra profits unless pressured to do so. Higher productivity does not produce higher wages.
This is the productivity-pay gap, in place since 1980 as real wages have barely budged while productivity has continued to skyrocket, the value from the accruing to a small wealthy minority.
Besides causing social ills such as the concomitant
de-democratization of society we are witnessing around us as a direct result of this, the productivity pay gap also undermines the fundamental fallacy of the AI hype crowd - higher productivity doesn’t translate into broader benefits for society, only for the business owning class.
Only external pressure can force business owners to part with gains from rising productivity. With the productivity-pay gap of the last 55 years wealth is so concentrated that the government today is entirely captured by business owners. Billionaires wave their hands and select government officials, unmake the constitution, and form new political parties. Can our government be relied on to pressure business owners into parting with their growing profits and raise wages? Our government has failed to do this for 55 years.
If engineers want higher wages for their increased productivity - which has multiplied since 1980 with little of that going to workers - then we will have to pressure business owners ourselves. The best way of doing that is unionizing.