According to an article by Tyler Cowen, labor’s portion of the US gross domestic product has been shrinking long-term, diminishing by seven percentage points since World War II. Based on certain metrics, the labor share for 2022 was slightly above 60%, which is the lowest level observed since 1929. Bloomberg Law reports.
This unfavorable trend for workers is not contained within the United States. Globally, the labor share, which represents the portion of an economy’s output that is allocated to workers, has decreased by six percentage points since the 1980s. The data suggests that in 13 out of 17 analyzed economies, the labor share is currently in decline. More comprehensive study into this issue introduces a broad range of concerning implications for both workers and economies worldwide.
Further investigation into Cowen’s original publication would provide more in-depth insights into this problem. Interested readers can access the work for more information at The American Economic Review.