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In Labor vs. Capital, Workers Gain a Slight Edge

Wall Street Journal (04/30/15) Greg Ip

Total salaries and benefits for U.S. employees in the first quarter of 2015 increased 1.2% from the previous quarter and 4.4% from a year ago. This is the biggest annual gain in pay since 2008. Labor’s share of gross domestic product also is on the rise.

The labor recovery is being driven by two forces. First, an acceleration in employment growth and a decline in the unemployment rate to 5.5%, which is near the level the U.S. Federal Reserve considers full employment. Second, with a growing share of companies citing difficulty finding employees, some are offering higher wages to attract or hold on to employees.