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

#351

Post by vondur » Tue, Jun 30, 2026, 5:55 PM UTC

vannevar wrote: post #139

legitster wrote: post #61

People 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.

This is consistent with the observation that the top 10% have captured a disproportionate share of GDP growth over the past few decades. https://equitablegrowth.org/new-data-reveal-how-u-s-economic... "The past three economic expansions have largely benefitted the top 10 percent. In each, the top decile received between 47 percent and 59 percent of all income growth in the expansion."

Aren't most of the tech workers here part of that 10% and I'd assume they own houses in some of the most expensive areas, so they are technically part of the capital class?

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

#352

Post by boelboel » Tue, Jun 30, 2026, 5:57 PM UTC

stymaar wrote: post #284

u1hcw9nx wrote: post #180

Earlier quoted context omitted.

Also note: Labor share has declined similarly across OECD countries for several decades. Automation, robots, software etc. they are all capital share.

> Automation, robots, software etc. they are all capital share. I highly doubt automation and robots are a meaningful factor here, but IP and outsourcing have the exact same as automation.

New factories use very few people, part of the reason why it's difficult for many countries to industrialize like South Korea or China did (climbing manufacturing ladder).

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

#353

Post by boelboel » Tue, Jun 30, 2026, 5:58 PM UTC

zer00eyz wrote: post #283

rsalus wrote: post #225

Earlier quoted context omitted.

> amount of labor being generated per person has not really changed not true, labor productivity has been steadily increasing: https://fred.stlouisfed.org/series/OPHNFB workers are simply capturing less of the economic value generated by their labor.

The chart you're showing, absolutely reflects the reality of some of the most productive segments of our economy. Ford now makes more cars, with fewer people. Sears used to have people who took photos, laid out catalogs, opened envelopes (with checks in them).... Amazon has none of that. We replaced switch board operators, with mechanical, then digital switching. More calls routed, fewer people required. go back 45 y…

Construction notably has had productivity losses since the 80s afaik.

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

#354

Post by larkost » Tue, Jun 30, 2026, 5:59 PM UTC

missedthecue wrote: post #314

rsalus wrote: post #225

Earlier quoted context omitted.

> amount of labor being generated per person has not really changed not true, labor productivity has been steadily increasing: https://fred.stlouisfed.org/series/OPHNFB workers are simply capturing less of the economic value generated by their labor.

Increases in labor productivity is a curious thing to think about. Do I deserve more wages for using AutoCad instead of drafting paper? - The amount I'm working hasn't increased. Still an 8 hour day. - My job honestly is easier than it used to be; certainly less menial. - Strictly speaking, the education requirement is actually lower . It's easier and a lower bar to learn to become a decent designer in AutoCad than t…

> Or should the innovators, firms, and customers all get less, and instead my wages should get bigger?

In almost all of the cases the "innovators" are themselves workers whose share of the outcome has been dropping. And the "customers" have never gotten a piece of the profits; we are already past the point where reduced prices would have happened (competition) in this system.

And I think that by "firms" you really mean some combination of executives and investors/shareholders. That is where the gains have been centralized. Do you really want to argue that management and investors deserve to have more of the gains? What have they done that makes them so much more valuable than similar groups in bygone days?

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

#355

Post by nradov » Tue, Jun 30, 2026, 5:59 PM UTC

ToucanLoucan wrote: post #324

nradov wrote: post #309

Earlier quoted context omitted.

Feel free to moralize all you like about the maximum wages other people should earn if that makes you feel better but that won't solve any of the actual problems. In the real world, most people respond to economic incentives. Shortages can always get worse. (I am not a physician.)

> In the real world, most people respond to economic incentives. Then why is there a shortage? Are you telling me the $750,000 yearly compensation still isn't enough?

Are you telling me that $750K yearly compensation still isn't enough for an NBA player? Maybe they should be nice and agree to play for less because they love the game and want to entertain people.

If we're talking about orthopedic surgeons specifically, a good one is essentially an elite athlete. A single tiny error can leave a patient dead or crippled. It takes a rare combination of intelligence, ability to focus for hours, physical strength, and fine motor control. So only a minuscule fraction of people even have the necessary potential. And the training pipeline is necessarily long because they need a lot of reps to build up the mental and physical skills, and to weed out those who aren't suited. Sure, you can find some people who are willing to do the work for lower wages but will they be the right people?

Beyond the wage issue, supply for all physicians is artificially constrained by training system capacity limits, as I already explained above. There are things that could be done to make training a bit cheaper and maybe two years shorter. But the easiest win would be to make more efficient use of the existing supply by optimizing workflows, and automating or eliminating administrative tasks.

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

#356

Post by throwway120385 » Tue, Jun 30, 2026, 5:59 PM UTC

nradov wrote: post #299

ratelimitsteve wrote: post #273

Earlier quoted context omitted.

is it humane to solve that problem by excluding people based on income? that's what your proposing, as that's how markets solve problems like this: if more people need a product/service than the market can provide prices go up and the poor are excluded. also not trying to be snarky but that's the choice in front of us. part of the problem with free market solutions to healthcare is the feasibility of walking away fro…

Stop lying, I haven't proposed anything of the kind. Free market solutions often include giving cash subsidies to certain participants (and you would be aware of this if you had bothered to do even basic research on serious healthcare system reform proposals before commenting). I'm simply pointing out that it's a complex problem with multiple causes and there is no simple solution.

Even cash subsidies can be a kind of chain. Why wouldn't we just subsidize the whole thing for everyone then? And if the purpose of a health insurance plan is to collect groups of people into "risk pools," then why wouldn't we just put everyone in a global risk pool? And if the purpose of a health insurance plan is to negotiate rates on behalf of a bunch of people, why wouldn't we have someone like CMS determine those rates? And if the purpose of a health insurance plan is to make sure everyone has health care, why would we create a system where people are excluded by means-testing?

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

#357

Post by rwmj » Tue, Jun 30, 2026, 6:00 PM UTC

missedthecue wrote: post #314

rsalus wrote: post #225

Earlier quoted context omitted.

> amount of labor being generated per person has not really changed not true, labor productivity has been steadily increasing: https://fred.stlouisfed.org/series/OPHNFB workers are simply capturing less of the economic value generated by their labor.

Increases in labor productivity is a curious thing to think about. Do I deserve more wages for using AutoCad instead of drafting paper? - The amount I'm working hasn't increased. Still an 8 hour day. - My job honestly is easier than it used to be; certainly less menial. - Strictly speaking, the education requirement is actually lower . It's easier and a lower bar to learn to become a decent designer in AutoCad than t…

Productivity is just aggregate output of the economy divided by the number of people-hours worked. You can argue about if that's a useful thing to measure or if the measurements themselves are accurate or if you should capture more of the output, but at root it's very simplistic. If you can use AutoCAD to generate more drawings than using paper which you (or your firm) sells for the same price per drawing, then your productivity did go up. Is that meaningful? Less certain.

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

#358

Post by GlickWick » Tue, Jun 30, 2026, 6:03 PM UTC

palmotea wrote: post #335

GlickWick wrote: post #316

Earlier quoted context omitted.

Nah, that's knee-jerk. Don't have a particular horse in this race, just explaining why some people might react this way to the word if they're aware of the history behind it. We as a society can determine whether or not we like certain words in our vernacular.

My point is: who cares about the origin of the word? IMHO, no one should. Unless the word used in a way meant to offend, it's fine. Otherwise you're kind of cultivating offense and over-sensitivity, helping it survive and grow, which helps no one.

It's trickier than that. There's a lot of people who are naturally aware of the history behind the word, and it's tough to remove emotion and intent from that history. Sometimes things bother people, and it's nice to understand why before deciding if you should do anything about it or not.

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

#359

Post by mynameisbilly » Tue, Jun 30, 2026, 6:05 PM UTC

gruez wrote: post #213

jzb wrote: post #166

Earlier quoted context omitted.

I think “abject poverty” is probably overstating the case a bit. I do think quality of life is trending downward given the fact that housing, food, gas, medical care costs are all increasing while wages are stagnant or worse.

>I do think quality of life is trending downward given the fact that housing, food, gas, medical care costs are all increasing while wages are stagnant or worse. ??? https://fred.stlouisfed.org/series/MEPAINUSA672N Note this is already inflation adjusted, so "housing, food, gas, medical care costs are all increasing" is already accounted for.

That chart doesn't make the case you think it does. Real median household income rising can be explained by things like more dual earner households (more women working since the 70s), more hours worked, etc. The household income can rise while the wages can theoretically remain flat or even fall.

The more relevant statistic is that median real wages have only grown by about 29% across 40+ years (~0.6% per year)

Since 2000, medical care costs have risen by 121.3%, hospital services by 275%, college tuition and fees by 196%, compared to consumer goods by 86.1%. Things like TVs and electronics went way down in costs while the essentials have absolutely skyrocketed. The cheap stuff drags the average down.

You need a lot more than a single graph to argue against the quality of life going down for Americans.

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

#360

Post by forgotaccount3 » Tue, Jun 30, 2026, 6:06 PM UTC

missedthecue wrote: post #314

rsalus wrote: post #225

Earlier quoted context omitted.

> amount of labor being generated per person has not really changed not true, labor productivity has been steadily increasing: https://fred.stlouisfed.org/series/OPHNFB workers are simply capturing less of the economic value generated by their labor.

Increases in labor productivity is a curious thing to think about. Do I deserve more wages for using AutoCad instead of drafting paper? - The amount I'm working hasn't increased. Still an 8 hour day. - My job honestly is easier than it used to be; certainly less menial. - Strictly speaking, the education requirement is actually lower . It's easier and a lower bar to learn to become a decent designer in AutoCad than t…

> Should I capture the increased output

You do capture the increased output by benefiting from a society where the cost to build safe buildings has drastically reduced.

Just because you don't get an immediate financial benefit doesn't mean you haven't benefitted from the increased output.