US Labor Share of Income Drops to Near Record Low
The proportion of wages in US gross domestic income has fallen to about 43%, near the lowest since records began in 1929, indicating a long-term shift of economic income toward corporate profits and investment income.
According to a report from The Kobeissi Letter, the share of wages and salaries in US gross domestic income (GDI) has declined to roughly 43%, approaching levels not seen since record-keeping began in 1929. GDI measures total income earned across the economy, including wages, corporate profits, and investment income.
This metric has been in a long-term downtrend since peaking at approximately 52% in the 1940s. Between the 1940s and 1960s, the labor share never fell below 48%. The current figure highlights a persistent shift: a growing portion of economic income now goes to corporate profits and investment returns rather than to workers.
The widening gap between corporate profits and labor income reflects a structural change in the US economy, with implications for income distribution and consumer spending.
Source: The Kobeissi Letter