US Labor Share of GDP Hits Record Low, Sparks Inequality Concerns

• The US labor share of GDP fell to a record low of 53.8% in Q3 last year, down from 54.6% in the previous quarter.
• This measure, tracking wages and salaries as a portion of economic output, has been declining since a 2020 pandemic spike.
• The same period saw corporations achieve historically high profit margins, fueling concerns about economic inequality.
• US labor productivity grew at its fastest pace in two years in Q3, partly attributed to increased AI adoption by companies.
• Economists are debating AI's dual impact: potential for faster economic growth vs. risks of job displacement and wage pressure.

Why It Matters: US labor's share of GDP reached a record low, raising inequality concerns amid rising corporate profits and AI adoption.