A new Economic Policy Institute report indicates that shareholders, not everyday workers, have reaped the lion’s share of the benefits from America’s considerable productivity gains over the past 20 years. According to Zachary Roth, writing for Yahoo! News (link here):
Despite large gains in productivity over the last two decades, the report finds, wages for American workers have been stagnating.
The study… by Lawrence Mishel and Heidi Shierholz of the Economic Policy Institute, found that productivity grew by a whopping 62.5 percent between 1989 and 2010, but that real hourly wages increased by just 12 percent over the same period. That suggests that companies are giving far more of their profits to shareholders, and far less to workers. Indeed, corporate profits are 22 percent above where they were before the recession.
Perhaps there are no big surprises here, as the EPI study merely documents what a lot of workers have been experiencing in their paychecks. Still, it’s useful to assemble this data to show how our economic system has been rigged to benefit the most fortunate.
The full report by Mishel and Shierholz, The Sad but True Story of Wages in America, can be downloaded here.
Ezra Klein comments further about the EPI report for the Washington Post, here.