Corporate Profits at All Time High. Wages at All Time Low.

By John Amaruso

Corporate profits compared to share of GDP
Business Insider

As the economic recovery slumps forward, fewer people are doing better, meanwhile a lot more people are doing worse than they were before the downturn.

A recent study conducted by Business Insider shows that corporate profits are at a record high while employment/wages are at an all time low.


Corporations (namely the largest of) are doing better than at any time since 1950. Research shows this comes as a result of a few common sense factors.

1. Corporations are paying people less than ever as a share of GDP (Gross Domestic Product) because they can get away with it. A limited job share (A.K.A. monopoly on labor) allows companies to pay whatever they say with little reaction/possible alternative for the worker.

Wages compared to share of GDP
Business Insider

2. Corporations are outsourcing jobs in many different ways, as in through technological replacements of workers (I.E. One computer does the work 20 people could do at a fraction of the cost) or of course, the shipping of jobs overseas.
3. Corporate tax loopholes/havens allow companies to either skip out on potential costs by retracting revenue from the American economy and providing that saved cost for itself or other governments with even lower tax rates.

So the next time someone says burdensome regulation or high taxes is what's stunting economic growth, tell them to look at the facts. Since wages are low, people can't spend, and when people can't spend, smaller companies that depend on these consumers lose customers and the cycle continues.

As Clinton famously once said...

It's the economy, stupid.