Pay growth has lagged productivity growth largely thanks to policy failures: Contribution (in 2017 dollars) of various factors to productivity–median compensation divergence, 1979–2017

Year Unexplained** Noncompetes, misclassification, overtime, supply chain dominance* Corporate globalization Eroded collective bargaining Excessive unemployment Actual growth Baseline
1979 $20.48 $20.48 $20.48 $20.48 $20.48 $20.48 $20.48
2017 $33.10 $30.72 $28.59 $27.30 $25.46 $23.15 $20.48

Notes: Automation/skill deficits had no effect.

* Dominant buyer and fissuring

** Including but not limited to: wage theft, guestworker programs, racial discrimination, industry deregulation, forced arbitration, and anti-poaching agreements

Source:  Adapted from Figure J in Lawrence Mishel and Josh Bivens, Identifying the Policy Levers Generating Wage Suppression and Wage Inequality, May 2021.

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