US Employee Share of Corporate Income Hits Record Low 54% as Profits Surge
Employee compensation as a share of US corporate GDP has fallen to about 54%, the lowest level since records began in 1948. Meanwhile, corporate profits as a share of GDP have risen to an all-time high of approximately 11.5%.
The share of US corporate income going to workers has dropped to its lowest point on record. According to data cited by The Kobeissi Letter, employee compensation as a percentage of corporate GDP fell to roughly 54% in the latest period, the smallest slice since tracking began in 1948.
In contrast, corporate profits as a share of GDP have climbed to about 11.5%, also an all-time high. The remaining roughly 46% of corporate income goes to items such as interest, taxes, depreciation, and other components.
Since 2001, the labor share of corporate GDP has declined by 10 percentage points, while the profit share has doubled. The figures underscore a long-term shift in the distribution of income within US corporations, with workers retaining a smaller portion of the value they produce than at any point in history.
Source: The Kobeissi Letter