4 ms·

This is the historical wage share of gdp of workers: https://en.wikipedia.org/wiki/Wage_share https://en.wikipedia.org/wiki/Wage_share And i'm sure the story f

by petra 9y ago

This is the historical wage share of gdp of workers: https://en.wikipedia.org/wiki/Wage_share https://en.wikipedia.org/wiki/Wage_share And i'm sure the story for the bottom 50% of employees is even worse. The trend is downwards, and the internet accelerated it. Does anyone think that robots and a massive technology boom that may soon happen won't accelerate it ? Why ? And from that trend, given minimum wage, it seems that at some point in time, we'll have large unemployment.

jieiieifnfj88 9y ago
Plenty of important work to be done: https://aeon.co/essays/the-key-to-jobs-in-the-future-is-not-college-but-compassion https://aeon.co/essays/the-key-to-jobs-in-the-future-is-not-...
- deleted 9y ago
  [deleted]
WoodenChair 9y ago
Why concentrate on share of GDP? Isn't it more relevant how many people are starving? How many people are literate? How long people are living and what the quality of their life is? I don't think share of GDP is a proxy for any of those. Perhaps median wage is though at PPP. The trends there are not great, but not as dire as this (IMHO false) picture implies.
- dangerlibrary 9y ago
  Because money isn't just for sustenance and shelter - it's also a way to buy power, freedom, and autonomy. As the shares become more uneven, people's ability to act to better their own circumstances without a handout from the ultra-rich (or without the permission of the ultra rich) is curtailed. Look at businesses being dominated by companies that can afford high fixed costs in order to gain huge economies of scale. Good luck opening a mom-and-pop grocery next to a Wal-Mart, or even an independent gas station within two miles of a Sheetz.
  - vlunkr 9y ago
    GDP != money though. It doesn't matter what part you play in the GDP if you make enough to live happily.
    - lovich 9y ago
      If all else remains equal the yes, if you are happy with what you get already you'd be fine. However we do not live in a society with static rules. Corporations and to a lesser extent individuals are constantly competing and lobbying to get rules changes in their favor, look at the current net neutrality fight. If workers have an ever decreasing share of GDP then they have an ever decreasing amount of power with which to counter that lobbying or lobby for themselves, and it's the sort of thing that can snowball
- petra 9y ago
  The real excat numbers aren't really important but the point is that there's a trend(also showing in median PPP like you say), a long term trend that shows employees get less of the pie, and I think it's reasonable to assume that automation will push this much further and has a chance to create unemployment.
- matt4077 9y ago
  Poverty has been defined in relative terms for decades, because all the data shows that this has a better correlation with various measures of the effects of poverty, such as poor health and early death, criminality, extreme political opinions, risk of homelessness, life satisfaction etc. Example: even when corrected for purchasing power, the vast majority of people on earth are poorer than the bottom 10% in the US. Yet they tend to do much better on those measures above than absolute definition of poverty would suggest.
  - ericd 9y ago
    I'd keep in mind that the causality might be the other direction - it might not be relative poverty causing those things, it might be those things causing relative poverty.
deleted 9y ago
[deleted]
ericd 9y ago
That's only for the US. How do you think it looks for India and China? What about in terms of Big Macs?
- jsudhams 9y ago
  I don't think India will be affected at all. Because of the 2 things. Most of the households in middle class only one person works. Otherwise, the 60 to 70 percent of the population is in farming. +Govt kind of already provides minimum wage to live. There are 5 Rs break fast, 108 days of worth govt provided job(Actually no job only money gets distributed about 100 Rs a day), 20 kg rice for 20 Rs, Free bus pass for school kids, laptop, tv, fan etc free for kids,
hammock 9y ago
Why is that necessarily bad? Does everyone need ongoing employment? Why can't more people build and own a business (or a robot, or other productive capital) instead?
- lovich 9y ago
  That would be great but our society, as it currently stands, is built around having a job and so people losing their jobs in large numbers is a big problem
- dangerlibrary 9y ago
  You're right! More people should open independent bookstores, groceries, and gas stations like they used to. Well, maybe not those things. Maybe a car dealership? Only if Elon Musk doesn't succeed in lobbying them out of existence. Concentration of wealth leads to the ability to outcompete any small business, increasing the risk of operating independently. It's like playing blackjack in a casino. Even if you could eke out a small statistical advantage, the house can stay solvent longer than you can through volatility (and that assumes an otherwise level legal/regulatory/lobbying framework). Even Silicon Valley's startup culture implicitly acknowledges this - bootstrapped companies are a footnote. Only those companies with the financial resources of insanely wealthy investors stand a chance at mainstream success. That means the (decreasing proportion) of insanely wealthy people have a growing amount of say in what companies are allowed to succeed.
- delazeur 9y ago
  Only a very tiny portion of the global population is in a position to own productive capital (or, at least, enough to support themselves). Even if the portion were higher, though, you are basically just advocating rent-seeking as the solution to job losses caused by automation, and that strikes me as dubious at best.
- rtpg 9y ago
  There's a reason why "I started my company with only myself, a garage, and a $3 million dollar inheritance" is an apt description of so many founders' stories. Perhaps seizing the means of production is the way to go ;) In all seriousness though, Even starting a small business requires a decently large buffer that most people simply don't have. Hard to build one if you're surviving on mimimum wage + food stamps. Living paycheck to paycheck is a real thing. Especially if you have family
prostoalex 9y ago
Wouldn't you expect the wage share to decline in aging society? Labor force participation has been on the decline https://data.bls.gov/timeseries/LNS11300000 https://data.bls.gov/timeseries/LNS11300000 the number of Americans receiving government disability benefits has been hitting the new records https://www.cnsnews.com/news/article/terence-p-jeffrey/10996447-disability-beneficiaries-hit-new-record https://www.cnsnews.com/news/article/terence-p-jeffrey/10996... and the only massive new opportunities are in self-employment sector (Uber, Doordash, AirBnB, app store), whom wage share explicitly excludes. That does not preclude GDP from growing as iPhones are still selling and Google searches are still returning ads.
- matt4077 9y ago
  Why would these demographic changes impact the labor share? A declining labor force participation would (assuming constant productivity) lower GDP, but it wouldn't have an impact on the distribution of that GDP between labor and capital.

by petra 9y ago

jieiieifnfj88 9y ago

Plenty of important work to be done: https://aeon.co/essays/the-key-to-jobs-in-the-future-is-not-college-but-compassion https://aeon.co/essays/the-key-to-jobs-in-the-future-is-not-...

deleted 9y ago
[deleted]

WoodenChair 9y ago

Why concentrate on share of GDP? Isn't it more relevant how many people are starving? How many people are literate? How long people are living and what the quality of their life is? I don't think share of GDP is a proxy for any of those. Perhaps median wage is though at PPP. The trends there are not great, but not as dire as this (IMHO false) picture implies.

dangerlibrary 9y ago
Because money isn't just for sustenance and shelter - it's also a way to buy power, freedom, and autonomy. As the shares become more uneven, people's ability to act to better their own circumstances without a handout from the ultra-rich (or without the permission of the ultra rich) is curtailed. Look at businesses being dominated by companies that can afford high fixed costs in order to gain huge economies of scale. Good luck opening a mom-and-pop grocery next to a Wal-Mart, or even an independent gas station within two miles of a Sheetz.
- vlunkr 9y ago
  GDP != money though. It doesn't matter what part you play in the GDP if you make enough to live happily.
  - lovich 9y ago
    If all else remains equal the yes, if you are happy with what you get already you'd be fine. However we do not live in a society with static rules. Corporations and to a lesser extent individuals are constantly competing and lobbying to get rules changes in their favor, look at the current net neutrality fight. If workers have an ever decreasing share of GDP then they have an ever decreasing amount of power with which to counter that lobbying or lobby for themselves, and it's the sort of thing that can snowball
petra 9y ago
The real excat numbers aren't really important but the point is that there's a trend(also showing in median PPP like you say), a long term trend that shows employees get less of the pie, and I think it's reasonable to assume that automation will push this much further and has a chance to create unemployment.
matt4077 9y ago
Poverty has been defined in relative terms for decades, because all the data shows that this has a better correlation with various measures of the effects of poverty, such as poor health and early death, criminality, extreme political opinions, risk of homelessness, life satisfaction etc. Example: even when corrected for purchasing power, the vast majority of people on earth are poorer than the bottom 10% in the US. Yet they tend to do much better on those measures above than absolute definition of poverty would suggest.
- ericd 9y ago
  I'd keep in mind that the causality might be the other direction - it might not be relative poverty causing those things, it might be those things causing relative poverty.

deleted 9y ago

[deleted]

ericd 9y ago

That's only for the US. How do you think it looks for India and China? What about in terms of Big Macs?

jsudhams 9y ago
I don't think India will be affected at all. Because of the 2 things. Most of the households in middle class only one person works. Otherwise, the 60 to 70 percent of the population is in farming. +Govt kind of already provides minimum wage to live. There are 5 Rs break fast, 108 days of worth govt provided job(Actually no job only money gets distributed about 100 Rs a day), 20 kg rice for 20 Rs, Free bus pass for school kids, laptop, tv, fan etc free for kids,

hammock 9y ago

Why is that necessarily bad? Does everyone need ongoing employment? Why can't more people build and own a business (or a robot, or other productive capital) instead?

lovich 9y ago
That would be great but our society, as it currently stands, is built around having a job and so people losing their jobs in large numbers is a big problem
dangerlibrary 9y ago
You're right! More people should open independent bookstores, groceries, and gas stations like they used to. Well, maybe not those things. Maybe a car dealership? Only if Elon Musk doesn't succeed in lobbying them out of existence. Concentration of wealth leads to the ability to outcompete any small business, increasing the risk of operating independently. It's like playing blackjack in a casino. Even if you could eke out a small statistical advantage, the house can stay solvent longer than you can through volatility (and that assumes an otherwise level legal/regulatory/lobbying framework). Even Silicon Valley's startup culture implicitly acknowledges this - bootstrapped companies are a footnote. Only those companies with the financial resources of insanely wealthy investors stand a chance at mainstream success. That means the (decreasing proportion) of insanely wealthy people have a growing amount of say in what companies are allowed to succeed.
delazeur 9y ago
Only a very tiny portion of the global population is in a position to own productive capital (or, at least, enough to support themselves). Even if the portion were higher, though, you are basically just advocating rent-seeking as the solution to job losses caused by automation, and that strikes me as dubious at best.
rtpg 9y ago
There's a reason why "I started my company with only myself, a garage, and a $3 million dollar inheritance" is an apt description of so many founders' stories. Perhaps seizing the means of production is the way to go ;) In all seriousness though, Even starting a small business requires a decently large buffer that most people simply don't have. Hard to build one if you're surviving on mimimum wage + food stamps. Living paycheck to paycheck is a real thing. Especially if you have family

prostoalex 9y ago

Wouldn't you expect the wage share to decline in aging society? Labor force participation has been on the decline https://data.bls.gov/timeseries/LNS11300000 https://data.bls.gov/timeseries/LNS11300000 the number of Americans receiving government disability benefits has been hitting the new records https://www.cnsnews.com/news/article/terence-p-jeffrey/10996447-disability-beneficiaries-hit-new-record https://www.cnsnews.com/news/article/terence-p-jeffrey/10996... and the only massive new opportunities are in self-employment sector (Uber, Doordash, AirBnB, app store), whom wage share explicitly excludes. That does not preclude GDP from growing as iPhones are still selling and Google searches are still returning ads.

matt4077 9y ago
Why would these demographic changes impact the labor share? A declining labor force participation would (assuming constant productivity) lower GDP, but it wouldn't have an impact on the distribution of that GDP between labor and capital.