Hacker News Board Hacker News, browsed like a classic message board
Live data from Hacker News

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

libertystreeteconomics.newyorkfed.org

Post reply on HN
Print view View original

531–540 of 573 posts

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

#531

Post by didgetmaster »

joe_mamba wrote: post #392
didgetmaster wrote: post #350

Earlier quoted context omitted.

Every discussion about the 'top 10%' seems to make the underlying assumption that the set of people who fall under that category are consistent. While there are certainly individuals who enter the top 10% (or top 1%) and stay there; there are large numbers of people who move in and out of those categories. For me personally, I am in the top 10%; but a few decades ago, I was not.

Here's what I found asking AI: US Household Wealth Distribution (Q1 2026, Fed DFA) Group | Share of US Total Net Worth ------------|------------------------- Top 0.1% | 14.4% Top 1% | 31.6% Top 10% | 67.9% | Bottom 90% | 32.1% Bottom 50% | 2.5% So, the top 10% holds roughly as much wealth as the bottom 90% combined. The top 1% alone holds more than the entire bottom 90% minus the upper-middle segment. To be in the to…

Those numbers for 2026 may be right, but they absolutely do not mean that anyone who finds themselves in one of those categories must stay there.

While there are many people who are currently in the bottom 50% and will probably stay there; no one is a slave who has to stay there.

My original post (which is somehow unpopular on HN) points this out. I spent my first 30 years in that group and worked my way out of it.

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

#532

Post by joe_mamba »

didgetmaster wrote: post #531
joe_mamba wrote: post #392

Earlier quoted context omitted.

Here's what I found asking AI: US Household Wealth Distribution (Q1 2026, Fed DFA) Group | Share of US Total Net Worth ------------|------------------------- Top 0.1% | 14.4% Top 1% | 31.6% Top 10% | 67.9% | Bottom 90% | 32.1% Bottom 50% | 2.5% So, the top 10% holds roughly as much wealth as the bottom 90% combined. The top 1% alone holds more than the entire bottom 90% minus the upper-middle segment. To be in the to…

Those numbers for 2026 may be right, but they absolutely do not mean that anyone who finds themselves in one of those categories must stay there. While there are many people who are currently in the bottom 50% and will probably stay there; no one is a slave who has to stay there. My original post (which is somehow unpopular on HN) points this out. I spent my first 30 years in that group and worked my way out of it.

>no one is a slave who has to stay there

That's like saying not everyone who finds themselves homeless must stay homeless, as if they can just choose to go buy a house.

>I spent my first 30 years in that group and worked my way out of it.

And what did the job market look like over the those 30 years versus today? You probably weren't competing with infinity AI bots at every resume application.

Not here to steal your thunder and deny your individual success story, but the tired "I pulled myself by my bootstraps" doesn't mean anything to the people who are strugling.

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

#533

Post by somenameforme »

cherryteastain wrote: post #434
pessimizer wrote: post #419

Earlier quoted context omitted.

The top 10% incomes have tons of assets, especially homes. Saying that billionaires "disproportionately" have more assets than non-billionaires is a tautology that says nothing. You might as well say that tall people have disproportionately more height than people who are not tall. Billionaire is a statement about wealth, not income. > In fact wage growth for the top decile has been recently slower than bottom decile…

Point is that income from dividends, rent and capital gains far outstrips the $150k the 90th percentile guy makes [1], which you have conveniently ignored. The $150k 90th percentile earner has more common with the $50k 50th percentile earner than he does with the billionaire earning $100M of capital gains, dividends and rent from assets. The 90th percentile guy is a wage laborer like the 50th percentile guy; they are…

Household income at the 90th percentile is about $250k per the US census. [1] And wealth disparities tend to be much larger yet still since a significant chunk of the $250k spending is going to go into things they have equity in like mortgage/low depreciation assets/etc, as opposed to food and rent. Especially in modern times where seemingly every industry is trying to figure out ways to charge rent while providing as little in return as possible.

Oligarchs have always been in their own class.

[1] - https://finance.yahoo.com/news/income-puts-top-10-earners-16...

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

#534

Post by bonesss »

b40d-48b2-979e wrote: post #448
bonesss wrote: post #197

Earlier quoted context omitted.

So “ landlord ” and “ commercial landlord living entirely off of passive income ” are worlds apart. Buying a fixer-upper outside of town with high-school and early 20s grinding, renting out 3+ rooms to cover the mortgage for painful years, working 80 hour weeks, refinancing against that first house into another under-maintained property where you live in half while upgrading the other, ending up with a rental duplex…

owning property young is achievable for electricians, security guards, and janitors. The comment wasn't about buying your first house, it was "owning several properties by the time you're 30" which a janitor of all things absolutely cannot do.

Read my comment again, and think more about what was said. I addressed multiple properties before 30 as a landlord, not first time buying as an employee. Because you are not accounting for cash flow & appreciation over time you are flat wrong.

A non-landlord janitor saddled with student loans losing 30%+ of income to housing versus a landlord whose housing is covered that works as a janitor from the get-go have wildly different leverage opportunities and savings potential at 20 and 5 years down the road. Committing to property ownership instead of school and maximally exploiting living at home gets the down payment, committing to property improvement instead of lifestyle is what gears the investment.

That massive monthly rental savings snowballs into a down payment in the 5 year picture, the first assets improvements and cash flow support lending for the subsequent property purchase, upgrades to which support refinancing and correcting cash flow in the original property. Backed by those assets and cash flow: multi-tenant properties, incorporation, or more aggressive flipping are straight shots backed by the appreciating assets and ongoing work income.

Janitors can clean on the side, work in corporate chains, work in secure facilities, make overtime, juggle multiple jobs, or snowball their hustle into a cleaning company. A landlord-janitor can be creating a crew of live-together like-minded grinders and be building business wealth in parallel to their rental business in a synergistic loop.

It is very possible, I know several people who done it, and know of numerous successful businesses structured around the same. A group of immigrants in a house with a cleaning van out front can be a respectable business. Five such houses could be an early retirement.

The conceptual breakdown tends to be in willingness to sacrifice, and do hard unglamorous work.

“Janitors of all things” can be smart entrepreneurs who grow wealth, just like how programmers, of all things, can misunderstand basic financial calculus.

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

#535

Post by lovich »

porridgeraisin wrote: post #523
lovich wrote: post #413

Earlier quoted context omitted.

You are in a bubble if you are surprised at the idea of companies not giving out stock, much less RSUs specifically. While it’s common in the big tech Silicon Valley companies there are thousands of other tech companies where the most they give are options, and I must repeat with a litany of caveats that make them effectively worthless, and even more where they only pay salary and have no way to gain equity at all. I…

Considering how my second paragraph was ignored, I assume you own stock in major companies either directly or through indices, thus making you a capital owner that makes money from other people's work (work used in the literal sense)? Note that around half of the US stock market is passively owned, so this is not a small number on aggregate Further see: my reply to a sibling in this same thread.

I “own” stock through my 401k. The “own” is in scare quotes because I cannot liquidate it other than as a loan for a home, and then only with my employers permission which is an odd definition for ownership and which most of the middle class in the US is bound by.

Considering how you ignored the response to you asking

> Eh? Which tech company doesn't give RSUs to fresh grads? Startups of course give options.

I assume you are not here in good faith and just want to argue that all is well and good.

Don’t try and hide behind your second argument when your first point was contested and then act all indignant.

Edit:

Responding to

> Further see: my reply to a sibling in this same thread.

I found your other reply here[1], quoting in case you edit it

> Exactly. The original comment in this thread asked if most tech workers here are part of the capital class themselves. Which was answered by saying that if you're employed by someone else, you are part of the worker class and thus tech workers are part of the worker class. > Introducing the fact that it's a spectrum and that equity ownership (which a vast majority of people in this industry have) makes you a capital owner is exactly my correction to that.

You are still assuming that most tech workers are given stock grants and have equity. I fundamentally disagreed with that.

I do not believe that the vast majority of people in this industry have been given equity.

Don’t try and pretend that I am wrong because I disagree with you. Show your work or be dismissed.

[1] https://news.ycombinator.com/item?id=48742201

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

#536

Post by stymaar »

jjk166 wrote: post #493
stymaar wrote: post #456

Earlier quoted context omitted.

> New factories use very few people That's both true and false. Yes they need very few people to operate , but building and maintaining still need a lot of people.

They need fewer people to build and to maintain than older ones did. Further the jobs from building the factory are temporary.

> Further the jobs from building the factory are temporary.

This is correct, and it has an impact on local employment and social dynamics, but not at the country level.

> They need fewer people to build and to maintain than older ones did.

That's absolutely not true. Quite the opposite. You do need less people to build and maintain a modern plant than to operate an factory in the past.

Also, you need to clarify what you mean by “older”, because heavy industries have automated steadily between the 50s and the 80s, and that process was mostly achieved by the 90s.

And I can't think of an industry that was still labor intensive by the 20s and that has been more impacted by automation than offshoring.

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

#537

Post by win311fwg »

latency-guy2 wrote: post #521
win311fwg wrote: post #183

Earlier quoted context omitted.

While you are able to look up someone's definition of abject poverty, the only definition that is relevant in this context is the one held by the author of the earlier comment. It is unlikely you can look up his definition (before he replies to those who have asked for the definition in force).

If only their definition matters then their only purpose in this thread is to derail the conversation, or in other words railroad everyone else out because only they can be right. People responding reject that, because if you're not being specific, you're not making an argument, you're just here to be an asshole. Since you've made this point, I've gone ahead and reported that comment.

> because only they can be right.

Suppose their definition for abject poverty is: having an income equal to or below the median income. Yes, they would be right. Is it a problem that they are right?

However, you would also be right in agreeing that having an income equal to or below the median income equates to half the population, so you are wrong to think that only they can be right. Of course, that assumes you have used my definitions for these terms and not your own. It is likely that, once we are updated with your definitions, that you were right all along. What are your definitions for the terms you have used?

That's the beauty of discussion. You don't need to guess. You can ask!

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

#538

Post by mech998877 »

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.

Robots (and other tools) are capital. A way I think of it:

if you formed a co-op of sorts, with let's say 20 people, starting with no land ownership and hardly any tools, they could try to make a business. Whatever they end up starting would be a fairly low-productivity business- washing windows, janitorial services, lawn service, etc. The more tools and land a co-op has to work with, the more productive they can be. With a few million dollars up-front they could have built a factory instead.

The increased productivity generated can be attributed to the capital share of income.

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

#539

Post by mech998877 »

tancop wrote: post #395
smt88 wrote: post #6

Earlier quoted context omitted.

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.

im going to be controversial and say no one should have anything other than labor as their main income until they retire. anything you can do thats useful to society counts as labor (but not vice versa, you can work as a robber or corporate lobbyist). from line cooks to wall street ceos to open source volunteers and stay at home moms who dont get paid but still work. landlords and executives count because management…

So if you buy a lawnmower and use it for your business to cut your neighbor's grass (instead of tearing it apart by hand), that should be illegal? You've used a capital investment to increase your productivity. Your productivity gains have driven anyone using a less efficient method out of the market.

What if it's a robot lawnmower instead of a push mower?

What if you and your neighbors pooled in some money to buy the robot lawnmowers?

What level of indirect management is unethical?

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

#540

Post by AnEro »

nradov wrote: post #329
AnEro wrote: post #88

Earlier quoted context omitted.

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…

I'm not sure what you mean by pricing for "HIPAA safe products"? It's not particularly expensive to comply with the HIPAA Privacy Rule, and honestly that level of privacy and security is the minimum we ought to expect in any industry that deals with sensitive consumer data. There aren't as many physician-led practices anymore. Most of them have been rolled up into larger health systems in order to achieve economies o…

The ops is crazy expensive, any service you get or buy into also instantly gets at least a 30% mark up. Look at the price of transport EDI clearinghouses vs healthcare! Yeah, it is stuff we should be doing for all data, but one mistake will leave you(business owner or contractor) with intergenerational debt or leave you criminal liable.

> There aren't as many physician-led practices anymore. Most of them have been rolled up into larger health systems in order to achieve economies of scale

There are plenty, in name at least many states have regulations to force this. Those larger roll ups are still clusters of smb doing 1-10m revenue monthly. They constantly fail and change hands behind the scenes, and are usually only protected by government regulations that reduce risk room to investors normally don’t have in other industries businesses. Their margins are like gambling almost and it’s a key driver of the service issues Americans face.

Post reply on HN