US workers’ share of income falls to lowest level since 1947

American workers took home 54.1% of national income in early 2026, the smallest share in the postwar record. The New York Fed’s analysis of Bureau of Labor Statistics data shows labor’s slice has slipped far below the more than 65% it exceeded after World War II, even as more of the economy’s gains flowed to corporations and investors.

The labor share measures how much of economic output goes to wages and salaries rather than capital income such as corporate profits and shareholder returns. The Federal Reserve Bank of St. Louis tracks the series back to the first quarter of 1947, and the New York Fed says the post-pandemic decline pushed it to its lowest level in that entire span.

That shift helps explain why headline growth can coexist with public unease. When output rises but a smaller share reaches paychecks, the benefits of expansion accrue more heavily to owners of capital than to workers trying to keep up with rent, food and borrowing costs. In the first quarter of 2026, analysis showed the corporate-profit share rising while workers’ pay grew more slowly, widening the gap between market performance and household experience.

Economists have linked the long slide in labor’s share to structural changes that stretch over decades. Among the factors cited are the erosion of union membership and tax-law changes that have steered more gains to CEOs, investors and high-income Americans. A National Bureau of Economic Research paper said that as of 2022, the share of U.S. income accruing to labor had already fallen to its lowest level since the Great Depression.

The Bureau of Economic Analysis treats corporate profits as a key national-income measure within the national income and product accounts, the framework used to track U.S. economic activity. That focus matters because profits are not just a byproduct of growth, but a central indicator of how national income is being distributed. The current split leaves workers with a smaller claim on the economy than any generation in the postwar era, while capital has captured a larger share of the gains.