Profit Shares Fall to the Lowest Level Since 2009

The Federal Reserve Board released an item of good news that might be missed. The Financial Accounts for the fourth quarter showed a decline in profit share of national income to 12.0 percent, the lowest annual share since 2009. It is far too early to know if this shift will be enduring, but it is encouraging in any case. On the plus side, wages have been growing rapidly in recent months, so this shift to wages may continue for the immediate future.

Source: Bureau of Economic Analysis, National Income Product Accounts, Table 1.13.

This first appeared on Dean Baker’s Beat the Press blog.

Dean Baker is the senior economist at the Center for Economic and Policy Research in Washington, DC.