Workers in Britain and the United States are getting a smaller share of national income than they did decades ago. That is not simply a feeling. The long-run data shows it.
In the UK, labour’s share of national income peaked at around 71% in the mid-1970s and has fallen to around 59%. The United States has experienced a similar long-term decline. The consequence is an enormous shift in income away from wages and towards profits, rents and the owners of capital.
There are four parts to GDP by income. Labour, Capital, Mixed Income and Taxes Upon Consumption and Subsidies to Production.
So, VAT started at 10%, fell to 8, is now 20%. That’s a tax upon consumption and increases one of the “other” components than labour or capital, yes? All those green subsidies…..are there more self-employed, which is mixed income?
Spud’s assuming, claiming, that capital and labour shares are inverses of each other. They’re not.
Aren’t the labour force also consumers, and hasn’t the consumer share of the national income increased? This £35 tabletslab does huge magnitudes more than my £125 ZX Spectrum could do 45 years ago.
I have mentioned this to one of Murphy’s famous ‘four horsepeople of the apocalypse’ – and bete noire of this space, Howard Reed.
You ignore the huge increase in the share extracted by government – if you add in the fact so many people in the ‘Labour’ share are employed by the government or within the quango space the share allocated to people doing necessary work has plummeted – Brown’s army of non-productive public sector workers are basically the human equivalent of a tapeworm, and more are hired every day by the Starmer/ Burn’em tyranny – the worst government in history.
In the late 1970s a lot of companies made losses instead of profits because wages exceeded value-added. After privatisation National Power stated that one-third of its workforce was redundant … All the industries that were privatised (apart from Water which had been controlled by local government so not subsidised by the national taxpayer) were required to reduce prices in real terms. The state monopolies had been bleeding their customers to boost state-sector unions.
Saying that labour’s share of national income peaked in the 1970s is like saying the balloon was biggest just before it burst.
“There are four parts to GDP by income. Labour, Capital, Mixed Income and Taxes Upon Consumption and Subsidies to Production.” What do you mean?
(i) There are four parts to GDP by income. Labour, Capital, Mixed Income, and Taxes Upon Consumption and Subsidies to Production?
(ii) There are four parts to GDP by income. Labour, Capital, Mixed Income and Taxes Upon Consumption, and Subsidies to Production?
(iii) There are five parts to GDP by income. Labour, Capital, Mixed Income, and Taxes Upon Consumption, and Subsidies to Production?
(iv) Something else?
I used to be paid to kick students’ arses when they wrote rubbish like that.
Workers in Britain and the United States are getting a smaller share of national income than they did decades ago.
So fucking what?
Is there a correct number it should be at?
Commie dick Murphy says the government must take over the economy because workers are getting a smaller share. Boohoo.
The Labour share is getting smaller
And Government’s getting larrrrrger.
workers are not. The Lanyard Classes, however…..