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Since 1948, productivity has increased but compensation has failed to keep pace

According to the Economic Policy Institute, there is a disconnect between productivity and compensation.  The issue stems from the fact that hourly compensation has leveled off since the 1980s while productivity has continued to rise.

While automation and advances in technology have a lot to do with this, it must be noted that employee pay has not risen in an even relation to inflation. The era of globalization and automation has seen a rise in profits while average global workers are not reaping the benefit.

But what can be done?

Efforts are currently being made by new governments (such as in America) to bring jobs to nations that are seeing a decrease in opportunities for high paying jobs.  This seems hard to imagine as many of those lost jobs aren’t abroad but rather no longer exist.  Technology is the hero of innovation but the enemy of employee compensation.

Although the gloominess of the EPI report is evident, there are positives.  It is now easier than ever to develop a new business and avenues for income has expanded.  These are positives for any person looking to establish themselves outside of a normal corporate environment.

Unfortunately the future is still bleak for normal employees.  Productivity it seems will continue to increase while compensation will continue its leveling.  Now is the perfect time to start a business, but not a good time to start employment.

To read the full report, please check out the EPI’s analysis HERE

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