The divergence between average wages and productivity over the last century is sometimes referred to as the “Great Decoupling.” The Economic Policy Institute (EPI), a union-affiliated think tank, produces a prominent report on the pay-productivity gap, pointing at the 1970s as the era when the U.S. moved away from unions and towards deregulation that likely led to the decoupling. In short, wages haven’t kept up with productivity because workers have less negotiating power.
EPI's Misleading Pay-Productivity Gap
EPI's Misleading Pay-Productivity Gap
EPI's Misleading Pay-Productivity Gap
The divergence between average wages and productivity over the last century is sometimes referred to as the “Great Decoupling.” The Economic Policy Institute (EPI), a union-affiliated think tank, produces a prominent report on the pay-productivity gap, pointing at the 1970s as the era when the U.S. moved away from unions and towards deregulation that likely led to the decoupling. In short, wages haven’t kept up with productivity because workers have less negotiating power.