Workers get less of the pie. A ILO's report confirms the fact. The bigger slice is always for capital.
In 16 developed economies, the average labor share dropped from 75% of national income in the mid-1970s to 65% in the years just before the economic crisis, and in 16 developing and emerging countries, it decreased from 62% of GDP in the early 1990s to 58% just before the crisis.
Capital income shares increased in a majority of countries. In China , wages tripled over the last decade, but GDP grew at a faster rate than the total wage bill. This surge cut down the labor's share.
Between 1999 and 2011, the report tells, average labor productivity in developed economies increased more than twice as much as average wages. In a number of larger economies including the US , Germany and Japan wage growth lagged behind productivity growth. In Germany , average wages declined in spite of positive average labor productivity growth in the years 1999–2007. In 2011, hourly wages were only marginally (0.4 percent) above their 2000 level while hourly labor productivity had grown by 12.8% over the same period. Real monthly wages remained flat although labor productivity soared by almost a quarter over the past two decades. The gap between hourly labor productivity and hourly compensation growth contributed to a decline in the labor share in the US, where real hourly labor productivity in the non-farm business sector increased by 85% since 1980 while real hourly compensation increased by only around 35%. In the UK , despite “productivity gains real average wages declined sharply. In a number of countries including Greece and a number of new EU member-countries, wages declined considerably more than labor productivity. In Greece average wages were forced down by austerity programs. However, in 2010-2011 cumulatively it fell down close to 15%. The minimum wage has been severely cut, losing 22 percent of its previous value. An IMF Fact sheet says “Wage cuts were necessary if the country was to regain competitiveness and growth.... The IMF also considered that the minimum wage in Greece was substantially higher than in other developed economies, even though ... it was not out of range.”
“Real average wage growth”, the ILO report finds, “has remained far below pre-crisis levels globally, going into the red in developed economies, although it has remained significant in emerging economies…. Omitting China , global real average wages grew at only 0.2 percent in 2011, down from 1.3 percent from in 2010 and 2.3 percent in 2007.” This is the hard fact of 0.2 percent, and the fact turns harder if one casts glimpses on the company, especially bank balance sheets of loss and profit. The sheets show a higher profit, higher dividends.
In developed economies, wages suffered a double dip; in eastern Europe and central Asia, real wages contracted severely in 2009; in the Middle East, real average wages appear to have declined since 2008. In a number of Arab countries, the Arab Spring “seems to have prompted... to make further increases in wages for local people working in the public sector. But in the private sector, minimum wages and collective bargaining are underdeveloped in the Arab region.” In Russia, the real value of wages collapsed to less than 40% of their value in 1990s. It took another decade before the Russian wages regained its initial level. In terms of real value of wages, is it a decade lost in Russian capitalist wilderness? In India, “Real wages declined in a majority of recent years, shrinking the purchasing power of wage earners. This would explain the many concerns expressed by workers in India about rapidly increasing prices, particularly food prices."
And there is cheap labor: Workers in the Philippine manufacturing sector were paid $1.40 for every hour worked. It was less than $5.50 in Brazil , $13 in Greece , $23.30 in the US , about $35 in Denmark .
Labor is made to move wheels with more speed, move its limbs and brain faster, stretch its muscles further but the number of coins that are thrown down on its frail hands increases with a slower speed. The gap widens. When necessary labor time is squeezed down further, wheels are turned speedier, and labor's bargaining power is weakened, the crueler reality declines to hide. It gets exposed. It's hard time for labor, a time of intensified exploitation of labor, a time for higher profit by capital. It's not “equitable growth”. In academic parlance what emerges is “working poverty”. Many waged and salaried workers in developing countries are in fact living with their families in poverty. Out of about 209 million wage earners in 32 developing countries from 1997 to 2006, about 23 million were earning below US$1.25 a day and 64 million were earning less than US$2 per day, the international poverty lines for 32 developing countries.
Labor's declining share in income means labor is paid less for its necessary labor time, and less payment for necessary labor time means labor is pressed down or squeezed out more for more profit by capital, which is labor's increased hardship, deprivation, suffering. Large numbers of employees are getting lower wages, finds the report. The reasons include reduced working hours and less overtime. In Ukraine, many employees had to go on unpaid leave. Reducing working hours and the amount of overtime is no kind-heartedness of capital. The measure has been taken to avoid lying off labor as lying off labor creates risky situation for capital, especially during the period of increased social tension.
Companies need scope for making profit in times of crisis. So, austerity is imposed on labor. To sharpen competitive edge, press down, squeeze out labor, ask labor to “sacrifice”. Many companies adopted new working practices, and labor's hourly wage rates were changed. “The mirror image of the fall in the labor share is the increase in the capital share of income (often called the profit share), which is measured most frequently as the share of gross operating surplus of corporations as a percentage of GDP.... In advanced economies, profits of non-financial corporations have increasingly been allocated to pay dividends, which accounted for 35 percent of profits in 2007 and increased pressure on companies to reduce the share of value added going to labor compensation.” In Sweden in the period 1987–2008, a large part of the increased surplus of corporations went into boosting the dividends to shareholders. In France , total dividends increased from 4% of the total wage bill in the early 1980s to 13% in 2008. In the US , three-quarters of the increase in gross operating surplus went into the payment of dividends.
Taken from here
In 16 developed economies, the average labor share dropped from 75% of national income in the mid-1970s to 65% in the years just before the economic crisis, and in 16 developing and emerging countries, it decreased from 62% of GDP in the early 1990s to 58% just before the crisis.
Capital income shares increased in a majority of countries. In China , wages tripled over the last decade, but GDP grew at a faster rate than the total wage bill. This surge cut down the labor's share.
Between 1999 and 2011, the report tells, average labor productivity in developed economies increased more than twice as much as average wages. In a number of larger economies including the US , Germany and Japan wage growth lagged behind productivity growth. In Germany , average wages declined in spite of positive average labor productivity growth in the years 1999–2007. In 2011, hourly wages were only marginally (0.4 percent) above their 2000 level while hourly labor productivity had grown by 12.8% over the same period. Real monthly wages remained flat although labor productivity soared by almost a quarter over the past two decades. The gap between hourly labor productivity and hourly compensation growth contributed to a decline in the labor share in the US, where real hourly labor productivity in the non-farm business sector increased by 85% since 1980 while real hourly compensation increased by only around 35%. In the UK , despite “productivity gains real average wages declined sharply. In a number of countries including Greece and a number of new EU member-countries, wages declined considerably more than labor productivity. In Greece average wages were forced down by austerity programs. However, in 2010-2011 cumulatively it fell down close to 15%. The minimum wage has been severely cut, losing 22 percent of its previous value. An IMF Fact sheet says “Wage cuts were necessary if the country was to regain competitiveness and growth.... The IMF also considered that the minimum wage in Greece was substantially higher than in other developed economies, even though ... it was not out of range.”
“Real average wage growth”, the ILO report finds, “has remained far below pre-crisis levels globally, going into the red in developed economies, although it has remained significant in emerging economies…. Omitting China , global real average wages grew at only 0.2 percent in 2011, down from 1.3 percent from in 2010 and 2.3 percent in 2007.” This is the hard fact of 0.2 percent, and the fact turns harder if one casts glimpses on the company, especially bank balance sheets of loss and profit. The sheets show a higher profit, higher dividends.
In developed economies, wages suffered a double dip; in eastern Europe and central Asia, real wages contracted severely in 2009; in the Middle East, real average wages appear to have declined since 2008. In a number of Arab countries, the Arab Spring “seems to have prompted... to make further increases in wages for local people working in the public sector. But in the private sector, minimum wages and collective bargaining are underdeveloped in the Arab region.” In Russia, the real value of wages collapsed to less than 40% of their value in 1990s. It took another decade before the Russian wages regained its initial level. In terms of real value of wages, is it a decade lost in Russian capitalist wilderness? In India, “Real wages declined in a majority of recent years, shrinking the purchasing power of wage earners. This would explain the many concerns expressed by workers in India about rapidly increasing prices, particularly food prices."
And there is cheap labor: Workers in the Philippine manufacturing sector were paid $1.40 for every hour worked. It was less than $5.50 in Brazil , $13 in Greece , $23.30 in the US , about $35 in Denmark .
Labor is made to move wheels with more speed, move its limbs and brain faster, stretch its muscles further but the number of coins that are thrown down on its frail hands increases with a slower speed. The gap widens. When necessary labor time is squeezed down further, wheels are turned speedier, and labor's bargaining power is weakened, the crueler reality declines to hide. It gets exposed. It's hard time for labor, a time of intensified exploitation of labor, a time for higher profit by capital. It's not “equitable growth”. In academic parlance what emerges is “working poverty”. Many waged and salaried workers in developing countries are in fact living with their families in poverty. Out of about 209 million wage earners in 32 developing countries from 1997 to 2006, about 23 million were earning below US$1.25 a day and 64 million were earning less than US$2 per day, the international poverty lines for 32 developing countries.
Labor's declining share in income means labor is paid less for its necessary labor time, and less payment for necessary labor time means labor is pressed down or squeezed out more for more profit by capital, which is labor's increased hardship, deprivation, suffering. Large numbers of employees are getting lower wages, finds the report. The reasons include reduced working hours and less overtime. In Ukraine, many employees had to go on unpaid leave. Reducing working hours and the amount of overtime is no kind-heartedness of capital. The measure has been taken to avoid lying off labor as lying off labor creates risky situation for capital, especially during the period of increased social tension.
Companies need scope for making profit in times of crisis. So, austerity is imposed on labor. To sharpen competitive edge, press down, squeeze out labor, ask labor to “sacrifice”. Many companies adopted new working practices, and labor's hourly wage rates were changed. “The mirror image of the fall in the labor share is the increase in the capital share of income (often called the profit share), which is measured most frequently as the share of gross operating surplus of corporations as a percentage of GDP.... In advanced economies, profits of non-financial corporations have increasingly been allocated to pay dividends, which accounted for 35 percent of profits in 2007 and increased pressure on companies to reduce the share of value added going to labor compensation.” In Sweden in the period 1987–2008, a large part of the increased surplus of corporations went into boosting the dividends to shareholders. In France , total dividends increased from 4% of the total wage bill in the early 1980s to 13% in 2008. In the US , three-quarters of the increase in gross operating surplus went into the payment of dividends.
Taken from here
1 comment:
A quarter of jobs in America pay below the federal poverty line for a family of four ($23,050). Not only are many jobs low-wage, they are also temporary and insecure. Over the last three years, the temp industry added more jobs in the United States than any other, according to the American Staffing Association.
Low-wage, temporary jobs have become so widespread that they threaten to become the norm. But for some reason this isn’t causing a scandal. At least in the business press, we are more likely to hear plaudits for “lean and mean” companies than angst about the changing nature of work for ordinary Americans.
American employers have been lowering wages and cutting benefits, converting permanent employees into part-time and contingent workers, busting unions and subcontracting and outsourcing jobs. They have done so, in part, because of the extraordinary evangelizing of the temp industry, which rose from humble origins to become a global behemoth.
A growing number of people call for bringing outsourced jobs back to America. But it's a return to shoddy, poverty-wage jobs.
http://opinionator.blogs.nytimes.com/2013/01/26/the-rise-of-the-permanent-temp-economy/
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