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These changes in the past of been a pendulum. I don't think the current changes are. Increasing automation, AI, etc, are vastly increasing the productivity of t

These changes in the past of been a pendulum. I don't think the current changes are. Increasing automation, AI, etc, are vastly increasing the productivity of the individual worker and replacing jobs. For a long time there's been an excellent well balanced feedback loop, more productivity = higher pay, higher pay = more purchasing power, more purchasing power = more production needed = more employment. However, wages are starting to stagnate. It could actually be one of the reasons we are getting such high employment. The feedback loop will stop. We as a society will need to decide what to do when it no longer makes sense to employ most people.

maxerickson 9y ago
Wages have been stagnant for a long time. You can almost trace it back to when Volcker broke the back of inflation. That's one thing that makes the current posture of the Fed pretty interesting.
- refurb 9y ago
  Wages might have been stagnant, but total compensation including benefits has not.
  - pmiller2 9y ago
    Does this still hold when health insurance is factored out?
    - refurb 9y ago
      I'm guessing it changes it considerably. In other words, total comp is going up, but much of it is being funneled towards ever more expensive healthcare. However, for business, the cost is just as real as giving employees a higher salary.
      - astura 9y ago
        The cost is lower because employer paid premiums for health insurance are tax exempt. That being said, it ends up as a tax on dual income households, I don't get paid more if I opt out of my employer's health insurance even though it saves them a significant amount of money (~$5,000 a year). That's at the employer's discretion but in my experience most employers don't come close to matching compensation.
jellicle 9y ago
> For a long time there's been an excellent well balanced feedback loop, more productivity = higher pay, Um, that feedback loop existed until 1972 or so, but has not existed since then. For most people in the United States, it has never existed in their lifetime. https://cdn.technologyreview.com/i/legacy/graph1.png?sw=600 https://cdn.technologyreview.com/i/legacy/graph1.png?sw=600

maxerickson 9y ago

Wages have been stagnant for a long time. You can almost trace it back to when Volcker broke the back of inflation. That's one thing that makes the current posture of the Fed pretty interesting.

refurb 9y ago
Wages might have been stagnant, but total compensation including benefits has not.
- pmiller2 9y ago
  Does this still hold when health insurance is factored out?
  - refurb 9y ago
    I'm guessing it changes it considerably. In other words, total comp is going up, but much of it is being funneled towards ever more expensive healthcare. However, for business, the cost is just as real as giving employees a higher salary.
    - astura 9y ago
      The cost is lower because employer paid premiums for health insurance are tax exempt. That being said, it ends up as a tax on dual income households, I don't get paid more if I opt out of my employer's health insurance even though it saves them a significant amount of money (~$5,000 a year). That's at the employer's discretion but in my experience most employers don't come close to matching compensation.

jellicle 9y ago

> For a long time there's been an excellent well balanced feedback loop, more productivity = higher pay, Um, that feedback loop existed until 1972 or so, but has not existed since then. For most people in the United States, it has never existed in their lifetime. https://cdn.technologyreview.com/i/legacy/graph1.png?sw=600 https://cdn.technologyreview.com/i/legacy/graph1.png?sw=600