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

#421

Post by topgrain2 » Tue, Jun 30, 2026, 7:05 PM UTC

nickff wrote: post #407

topgrain2 wrote: post #384

Earlier quoted context omitted.

https://www.irs.gov/businesses/small-businesses-self-employe...

Yes, that is intended to disallow officers from avoiding taxes by being compensated via ‘loans’ and other means. I can’t find any case where dividends or buybacks were found to be violations of that rule. https://cpataxteam.com/blog/s-corp-owners-are-you-paying-you... Do the math for yourself. Paying corporate taxes on profits, then dividend taxes on what gets paid out is not a savings versus paying income+payroll ta…

There are more taxes than federal income and corporate taxes. State taxes and especially the ~15% of wages that go to FICA also matter (the topic was small businesses, so presumably the owner's not making so much more than the FICA limit that this becomes negligible).

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

#422

Post by scottyah » Tue, Jun 30, 2026, 7:06 PM UTC

triceratops wrote: post #411

scottyah wrote: post #326

Earlier quoted context omitted.

While about 50% to 60% of the adult U.S. population are active W-2 wage earners at any given time, the percentage that relies on labor exclusively (meaning they have zero capital income or assets to fall back on) sits right around 40% to 50% of working households.

> 40% to 50% of working households Not people then.

Are you arguing that the other people in a household are laboring, or do you think they're counting pets?

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

#423

Post by globular-toast » Tue, Jun 30, 2026, 7:07 PM UTC

ETH_start wrote: post #86

I 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…

Until you can eat an agent it's all worthless.

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

#424

Post by FatherOfCurses » Tue, Jun 30, 2026, 7:07 PM UTC

zer00eyz wrote: post #126

dozerly wrote: post #90

Earlier quoted context omitted.

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.

> half of the US is living in abject poverty while quality of life for everyone is decreasing. The 350 million Americans looking at the top of the US economy and crying need to turn around and take a look at what's behind them. There are something like 7 billion people behind them, worse off.

This is like an abusive parent saying "Stop crying or I'll give you something to really cry about."

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

#425

Post by scottyah » Tue, Jun 30, 2026, 7:09 PM UTC

contagiousflow wrote: post #337

scottyah wrote: post #228

Earlier quoted context omitted.

https://equitablegrowth.org/u-s-income-data-for-2024-shows-t... Bottom 50% is increasing income with the top 10%, it's the middle class that's declining in the last 5 years. This was a quick google search, so I'll ask you to provide a source that's contrary else your comment was purely rhetorical and made in bad faith.

Well I would implore you to read your own source. And maybe start hanging around groups that read more

With two attacks on my character and a demonstrated lack of reading comprehension later, how much better do you feel?

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

#426

Post by skybrian » Tue, Jun 30, 2026, 7:09 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…

More productive companies earn more revenue and can offer more compensation to try to get better workers. That's why software engineering pays more than many other occupations. It's not because they're nice.

But for this to work, employers have to believe that hiring better workers matters.

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

#427

Post by mynameisbilly » Tue, Jun 30, 2026, 7:10 PM UTC

gruez wrote: post #412

mynameisbilly wrote: post #359

Earlier quoted context omitted.

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…

>That chart doesn't make the case you think it does. Real median household income rising [...] Where are you getting household income from? It clearly says "Personal Income"

You're right, I was mixing up the related charts. Still, this makes my case even stronger since personal controls for adding more earners to a household. If real median personal income only rose from ~$28k in 1974 to ~45$k today, that's a 60% increase. Median personal income rising by 0.9% every year over 50 years compared to healthcare rising by 3-4% every year since 2000 is not a gap you can ignore. Necessities grew at nearly 3 to 4x the income rate.

So the case that quality of life is trending downward is still completely valid and shows why you can't just point at a single graph and say "see? line go up therefore quality of life fine"

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

#428

Post by nielsbot » Tue, Jun 30, 2026, 7:10 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

yes

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

#429

Post by tadfisher » Tue, Jun 30, 2026, 7:10 PM UTC

GlickWick wrote: post #358

palmotea wrote: post #335

Earlier quoted context omitted.

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.

In particular, people with uteruses can be hyper-aware of the etymology, and I've had several inform me about it in the past, which helped me decide to avoid it.

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

#430

Post by marcusverus » Tue, Jun 30, 2026, 7:11 PM UTC

dozerly wrote: post #90

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.

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.

The United States doles out >$30K/year in welfare spending for each person (not household, each person) under the poverty line. And that's just HUD/SNAP/Medicaid. The idea that any significant portion of the US is living in "abject poverty" (let alone half!) is hysterical in every sense of the word.