The labor share of income in the US is at its lowest post-war level • Hacker News Board

Re: The labor share of income in the US is at its lowest post-war level

#21

Post by clusterhacks » Tue, Jun 30, 2026, 3:52 PM UTC

FTA's conclusion:

"Is this decline a distinct change from the recent behavior of the labor share in the U.S.? Along the two key dimensions we investigate, our answer is no. ... and they provide little evidence that it will evolve differently from past episodes."

This conclusion seems to be against "this time is different" arguments. Should we be generally encouraged by similarity to past declines pre-2000 or bearish and think that there is more drop to come like the 2000-2007 and 2007-2019 periods they graph out?

I guess there is no way to predict other than check back in after time passes.

Re: The labor share of income in the US is at its lowest post-war level

#22

Post by [deleted] » Tue, Jun 30, 2026, 3:52 PM UTC

[deleted]

Re: The labor share of income in the US is at its lowest post-war level

#23

Post by simianwords » Tue, Jun 30, 2026, 3:53 PM UTC

I find this metric misleading. Where is the extra money going? To whom? Turns out most of it is not going to billionaires. Bulk of it is going to future investments. If we choose not to do that, we lose out on future gains.

Re: The labor share of income in the US is at its lowest post-war level

#24

Post by contagiousflow » Tue, Jun 30, 2026, 3:53 PM UTC

smt88 wrote: post #6

scrumbledober wrote: post #3

it feels like every share of income is at its lowest except for the ultra wealthy.

It’s not. There are plenty of non-wealthy people who make money from things other than their labor. Small-time landlords are an example, as would be anyone who owns a small business and draws cash from profits rather than taking a salary.

> non-wealthy

> landlord

If you think these two things are compatible you need to talk to more people outside of your bubble.

Re: The labor share of income in the US is at its lowest post-war level

#25

Post by rafterydj » Tue, Jun 30, 2026, 3:55 PM UTC

sigmoid10 wrote: post #17

Yikes. Good to know that labor shares used to rebound after crises, but since the 2000s and the dotcom bubble it has basically been downhill only. So don't expect any of this to get better unless we roll back technology to the last millenium.

Not technology - that's only downstream of politics.

No political administration in my lifetime (!) has made policy decisions against the interests of tech monopolists. The closest we got was Lina Kahn's FTC.

Re: The labor share of income in the US is at its lowest post-war level

#26

Post by simianwords » Tue, Jun 30, 2026, 3:55 PM UTC

nimbius wrote: post #14

this is relatively unremarkable for those with an understanding of wage, labor, profit, price and capital. capitalism will always seek to reduce labor cost. during the epoch of neoliberalism it achieved great strides in this by reducing labor power through union busting by both thatcher and reagan in the UK and US respectively. it has also effectively curtailed any increase in the minimum wage for nearly 20 years as…

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Re: The labor share of income in the US is at its lowest post-war level

#27

Post by ux266478 » Tue, Jun 30, 2026, 3:56 PM UTC

scrumbledober wrote: post #3

it feels like every share of income is at its lowest except for the ultra wealthy.

It's not necessarily limited to the ultra wealthy, but outside of a few key areas (as someone mentions, those profiting off of the inflationary spike, those in the real estate market, etc) it is more or less the case, yes.

Re: The labor share of income in the US is at its lowest post-war level

#28

Post by crossbody » Tue, Jun 30, 2026, 3:56 PM UTC

What happens if large cohort of Boomers retires and stop working, instead living on their savings? Labor share of income drops. If you remove this effect, the labor share of income is flat - confirmed by last week's analysis in The Economist.

Re: The labor share of income in the US is at its lowest post-war level

#29

Post by hash872 » Tue, Jun 30, 2026, 3:57 PM UTC

I don't have time for a longer comment, but AIUI this is mostly a statistical illusion caused by changes to US tax law- previously income that was attributed to 'labor' shifted over to LLCs/S corps for more beneficial tax rates. The doctor, lawyer, financial advisor, CPA etc. that in past decades would have had his/her income run through a W2 arrangement shifted to becoming a one-person corporation

Re: The labor share of income in the US is at its lowest post-war level

#30

Post by nairboon » Tue, Jun 30, 2026, 3:57 PM UTC

kevmo wrote: post #10

This is clearly heading in a direction where the USA is going to elect a huge number of socialists, who in turn are going to enact massive taxes on billionaires and break up the monopolies.[1] This is why I think the billionaire oligarchs are literally mentally ill. They've won the entire game. They control everything. They live like gods, they twitch a pinky and millions dance. But their response to all of this powe…

Remember Occupy Wall Street? Back then the oligarchs were somewhat scared.