That most-recent spike during/post-COVID really puts into perspective just how unreasonable low-wage employers were to be so hysterical.
Highly suggest adding "hysterical" to your internal vocabulary filter.
The labor share of income in the US is at its lowest post-war level
81–90 of 573 posts
Re: The labor share of income in the US is at its lowest post-war level
#82I 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
Do you have any evidence for this, at all?
Re: The labor share of income in the US is at its lowest post-war level
#83FTA'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…
> I guess there is no way to predict other than check back in after time passes.
Welcome to the dismal science of economics, where the rear-view mirror is crystal clear but the windshield is totally fogged up.
Re: The labor share of income in the US is at its lowest post-war level
#84Re: The labor share of income in the US is at its lowest post-war level
#85Earlier quoted context omitted.
> If we want to increase the labor share then we'll drive down healthcare spending. It may not be simple but it's clear the United States is doing something catastrophically wrong. All the other healthcare systems on the planet in developed countries have problems, sure. But we spend magnitudes more money to receive middling-to-shit healthcare. Medical debt and bankruptcy is a unique American problem that also happen…
If the insurance companies disappeared tomorrow, presumably all medical care is paid for at point of use by patients? That would mean stochastically facing catastrophic bills from providers. I am sympathetic to the idea that healthcare providers and systems here should be making no more than in, say, Europe, but an orthopaedic surgeon being paid the $300k USD-equivalent in Germany instead of his $750k USD income toda…
> would be very unhappy.
Significantly increasing the supply of doctors would solve that, though.
Re: The labor share of income in the US is at its lowest post-war level
#86I wonder if labor itself will become an anachronism in the age of AI. Perhaps the future economic landscape will be dominated by capital because everyone will own capital. You will command a small army of agents to do whatever you want. You will no longer need to work for someone. You own small businesses far more than you could possibly operate in the pre-AI era and they will mostly operate autonomously with minimal direction and some guidance from you.
Re: The labor share of income in the US is at its lowest post-war level
#87Obviously the solution here is for workers to also become shareholders.
The US has historically been quite opposed to the workers becoming shareholders.
Re: The labor share of income in the US is at its lowest post-war level
#88The actual labor share of income is significantly higher when you include employer contributions to employee health insurance premiums. Healthcare costs have been rising faster than overall inflation for decades, and while many of those costs are passed on to employees the employers have also absorbed a significant chunk. If we want to increase the labor share then we'll drive down healthcare spending. And no, there'…
I've built and audited medical billing systems and billing practices. It isn't an economics issue in a traditional sense. Infact it would drastically reduce complexity of these systems and payments over time, even allowing private insurers to exist but have to compete with a base general coverage. (many smarter people than me at princeton did economics showing this worked out as a net less expensive than what we are doing now) The biggest reason why its not the simplistic solution, is politics of all the middle men (me) making exponential returns from solutions to these systemic issues.
Too much money in the system being flawed, look at pricing for any HIPAA safe products and thats just technology. Money is so hard to get for healthcare providers it is its own industry of revenue cycle management and thrid party billers. Most of these physician lead practices charge more is because planning your account around reemburcement cycles from insurance companies are 30-120 days if your lucky is an advanced accounting problem. (Thats excluding complexities of audits, LOPs, network rates etc.) Medicare/medicaid the fraud side has lots of tiny wins through leaning on tax information more, taking the model from the successful basic income studies and trials worked out.
Re: The labor share of income in the US is at its lowest post-war level
#89The actual labor share of income is significantly higher when you include employer contributions to employee health insurance premiums. Healthcare costs have been rising faster than overall inflation for decades, and while many of those costs are passed on to employees the employers have also absorbed a significant chunk. If we want to increase the labor share then we'll drive down healthcare spending. And no, there'…
While healthcare spending isn’t included in some economic measures like wages (which has contributed to the distorted productivity-pay gap discourse), labor share as discussed in this article is actually calculated using total compensation, the “total of payments to labor to produce output, including wages, benefits, and other monetary or nonmonetary payments,” which includes employer contributions to medical care not just wages and salaries.[0] They do discuss payroll share later on though, which doesn’t include non-wage compensation.
Re: The labor share of income in the US is at its lowest post-war level
#90People are misreading the conclusion - the Covid related drop is normal and matches previous episodes, but the massive overall drop since 2000 is not. The situation on the ground is unchanged - the amount of labor being generated per person has not really changed, but the overall pie has grown massively around us.
We have one of the worlds most prosperous economies, and half of the US is living in abject poverty while quality of life for everyone is decreasing.