Why Wages Have Stagnated While GDP Has Grown: The Proximate Factors | An Economic Sense

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As the diagram above shows, real median wages have been stagnant since at least 1980, despite real GDP per capita which is 78% higher now than then. Real median wages are only 5% higher (and in fact unchanged from 1979). In a normally developing economy, one would expect real GDP per capita and real wages to move together, growing at similar rates and certainly not diverging. But that has not been the case in the US since at least the early 1980s.

Why has such a large wedge opened up between worker earnings and GDP per capita? This blog post will look at the immediate factors that lead from one curve to the other. This will all be data and arithmetic, but will allow one to decompose the separation into several key underlying factors.

https://aneconomicsense.org/2015/02/13/why-wages-have-stagnated-while-gdp-has-grown-the-proximate-factors/