Wages Declining as a Share of National Income – Economics Help

The ILO recently produced their growth and wages report for 2012/13. This suggested that across the developing world, labour markets are being characterised by falling real wages and a decline in labour’s share of national income. In particular:

Real wage growth has been flat – even negative in the past few years.

There is an increasing gap between productivity growth and wage growth. Wages are not rising along with productivity.

Wages are becoming a smaller share of national income.

In 16 developed economies, labour took a 75% share of national income in the mid-1970s, but this has dropped to 65% in 2007. It rose in 2008 and 2009 – but only because national income itself shrank in those years – before resuming its downward course. (Wages in developed world shrink at Guardian)

via Wages Declining as a Share of National Income – Economics Help.

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