I think everyone’s seen the famous graph from the Economic Policy Institute, that show that while Productivity has been growing in a steady and linear fashion decades after decades, wage began to stagnate in the 70s.
Since the 70s, wage have grown about +0.6% per year, while productivity has grown at an average of 1.4% per year. That gap is enormous and it is compounding over time.
Can someone me why it’s happened?
In: Economics
Productivity has gone up dramatically with new technologies (think computers and giant manufacturing arms), but the issue is that true ownership over those new technological gains that increase output is consolidated within a relatively small group of wealthy people.
Therefore, you will see productivity increasing, but most of the profits are only benefiting a small group of people at the top of the pyramid.
CEOs and wealthy shareholders are rapidly getting to the point of trying to replace everyone with automation and increasing the “productivity” of the few people who still have jobs, while paying themselves insanely high wages.
Ultimately, if there is not some sort of technology tax, we will just have 90% of people out of work and poor in the future. You can already start to see this happening again in larger numbers with AI.
Before AI, it was assembly lines and other new machines putting people out of work. Now it will firmly be a problem for just about anyone who isn’t able to afford the extremely expensive equipment that makes our world turn.
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