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For corporate profits over worker wages, the gap has never been wider
Corporate profits as a share of GDP reached a historic high while labor share hit record lows, reflecting widening economic inequality, KPMG economist Diane Swonk said.
- On Feb. 17, 2026, a measure comparing corporate profits to employee compensation hit the highest level on record since World War II, with KPMG economist Diane Swonk charting this gap against labor's share of GDP.
- AI-Driven productivity gains lifted output per worker last year as firms, realizing they overhired, pulled back while pandemic-era subsidies expired in 2025.
- Nonfarm jobs rose an average 0.47% in 2025, the weakest growth rate outside recession since 2003, while GDP rose 4.3% yearly and layoffs surged more than 200%, with Nike, Amazon and UPS cutting jobs this year.
- This trend is likely to prove more unsettling than prior episodes of 'jobless growth,' El-Erian wrote, as spending concentrates with the top 20% of Americans and nearly three-fifths see a recession.
- Economists and investors are watching how affordability initiatives ramp up ahead of November's midterm elections, while Goldman Sachs estimated AI could impact around 300 million full-time jobs globally and JPMorgan economists linked higher graduate jobless rates to AI excitement.
12 Articles
12 Articles
Where do you land in the K-shaped economy? Do you think that will change in 2026?
There’s a widening gap between the haves and the have-nots in the United States, and economists are increasingly sounding the alarm. Income inequality has expanded in a short timeframe, and various economic indicators – including rising delinquency rates – are flashing a warning sign.
The Stock Exchange has strengthened the budgets of high-income households, which in turn are supporting consumer spending and economic growth. The lower incomes, on the contrary, pull the belt
Investing legend Mohamed El-Erian gives 3 reasons why the US job market will continue to lag a booming economy
Rob Kim/Getty ImagesMohamed El-Erian thinks the US job market will keep lagging the rest of the economy.He notes that job growth has decoupled from economic expansion over the past year.The trend is likely to continue and could result in economic pain, El-Erian wrote in a recent op-ed.The job market isn't going to catch up with the rest of the US economy anytime soon.That's according to top economist Mohamed El-Erian, who thinks there's an "unus…
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