Since the end of the 1970s, earnings for the bulk of the workforce have been falling behind increases in wider prosperity. As a result, the share of national output taken by wages has been in freefall, shrinking from around 60% in 1980 to 53% in 2007. In contrast, the share taken by profits in that year stood at a near post-war high.
Moreover, this squeeze has been felt most heavily by middle and low earners. While real earnings for well-paid professionals more than doubled in the three decades to 2008, middle earners enjoyed a rise of 56% and pay for those near the bottom tenth rose by a mere 27%. Some unskilled and semi-skilled jobs now pay little more in real terms – and in some cases less – than they did in the late 1970s. As a result, the proportion of the population working on low pay has almost doubled from 12% in 1977 to over 22% today.
This sustained shrinking of the earnings pool,
While economic capacity has been rising at 1.9% a year over this 30-year period, wages have been rising by only 1.6%, a gap which has been getting even wider over the last decade. Between 2000 and 2007, productivity increased at almost twice the rate of real wages. It was this trend that has been the main cause of stagnant real earnings.
What is the gibbering nonsense?
Having told us that real wages have been rising for decades, having given us the actual number by which they have, how can you then turn around and say either that the earnings pool has shrunk or that real wages have stagnated?
Did you not read the earlier sentences you wrote?
It is true that the workers are getting a smaller share of a larger pie. And if that smaller share of said larger pie led to the total amount, the size of the slice, being smaller then I\’d be just as appalled as you\’re pretending to be.
But as you point out, this isn\’t true. The pie has grown so much larger that that smaller share is actually a larger slice.
Which brings us to a Chuck Norris is wearing Spandex point: your argument is invalid.