Decomposing the growing wedges between productivity and median pay since 1973, selected years
| 1948–1973 | 1973–1979 | 1979–1995 | 1995–2000 | 2000–2007 | 2007–2019 | 1979–2019 | |
|---|---|---|---|---|---|---|---|
| Basic trends (annual growth) | |||||||
| Gross productivity | 2.80% | 1.06% | 1.38% | 2.33% | 2.19% | 1.11% | 1.56% |
| Net productivity | 2.75% | 0.92% | 1.19% | 2.13% | 1.94% | 0.94% | 1.36% |
| Net productivity, effective | 3.04% | 0.53% | 0.96% | 1.65% | 1.84% | 0.89% | 1.18% |
| Average hourly compensation, overall | 3.00% | 0.81% | 0.82% | 2.18% | 1.19% | 0.62% | 0.99% |
| Average hourly compensation, production + nonsupervisory workers | 2.91% | 0.23% | -0.32% | 1.07% | 0.63% | 0.69% | 0.32% |
| Gross productivity – nonsupervisory compensation gap (1–5) | -0.11% | 0.83% | 1.70% | 1.25% | 1.56% | 0.42% | 1.24% |
| Net productivity – nonsupervisory compensation gap (2–5) | -0.16% | 0.09% | -0.51% | 0.88% | 0.38% | 0.53% | 0.13% |
| Net effective productivity – nonsupervisory compensation gap (3–5) | 0.14% | 0.30% | 1.28% | 0.57% | 1.21% | 0.20% | 0.86% |
| Contribution to gap between nonsupervisory compensation and gross productivity | |||||||
| Depreciation (1–2) | 0.05% | 0.14% | 0.19% | 0.20% | 0.25% | 0.17% | 0.19% |
| Divergent price deflators (2–3) | -0.29% | 0.39% | 0.24% | 0.48% | 0.10% | 0.05% | 0.19% |
| Inequality of compensation (4–5) | 0.10% | 0.58% | 1.14% | 1.11% | 0.56% | -0.07% | 0.67% |
| Loss in labor’s share of income (3–4) | 0.04% | -0.28% | 0.14% | -0.53% | 0.65% | 0.27% | 0.19% |
| Contribution to gap between nonsupervisory compensation and net effective productivity | |||||||
| Inequality of compensation | 0.10% | 0.58% | 1.14% | 1.11% | 0.56% | -0.07% | 0.67% |
| Loss in labor’s share of income | 0.04% | -0.28% | 0.14% | -0.53% | 0.65% | 0.27% | 0.19% |
| Share of gap between nonsupervisory compensation and net effective productivity | |||||||
| Inequality of compensation | 72.41% | 192.47% | 88.87% | 193.31% | 46.41% | -36.97% | 78.32% |
| Loss in labor’s share of income | 27.59% | -92.47% | 11.13% | -93.31% | 53.59% | 136.97% | 21.68% |
Note: The rows showing the contribution of each influence to the gap between median hourly compensation and gross productivity shows the average annual percentage-point change in this gap contributed by each influence. The rows displaying the share of the gap between median hourly compensation and net effective productivity divide this contribution by the total gap. Because the net effective productivity series already accounts for depreciation and divergent price deflators, only the influence of compensation inequality and the shift away from labor’s share of income are left.
Source: BEA NIPA tables and BLS CES.