|>>|| No. 426007
It's all about wealth generation and the distribution thereof. Back when your dad was in the workforce, work productivity was a tiny fraction of what it is today in terms of output per man hour. With today's technology, a single worker can output ten times as much in a given time period as in the mid-20th century. This stark rise in productivity was anticipated by sociologists and futurists alike in the 50s and 60s.
The fallacy that they then committed, however, was that they assumed that all that increase in productivity and fewer man hours needed to maintain a certain level of output would mean that workers would get to spend more time off with no loss of pay. I've got stacks of old issues of Popular Mechanics in my basement still from my dad from the late 1950s to early 60s, and in them, you can read loopy visions of the future, of people barely working three days a week as early as the 1980s, and spending their income and all their free time on holidays to space stations orbiting Earth.
What went wrong was that all these increases in productivity ended up not being paid out to workers and employees, but they led to competitors undercutting each other on prices per unit on goods markets. And it kind of makes sense from an economist's view point. In industries were you have oligopolic competiton, enterprises will tend to see increases in productivity as a cost advantage against other competitors. So the price for a good goes down nearly the same way as productivity has increased. This in turn means that not only do workers not see wage increases, but as time goes by and technology evolves yet more, workers will be made redundant because machines tend to outperform human workers many times over and at much lower cost. And therefore, increases in productivity have not generated more wealth for the common worker.
Also, you have to consider the role of capital. Capital wants to see interest, and as that interest is generated through investment returns, for example from investments in factories and companies, that money then needs to appreciate as well. So what you have is an enormous feedback loop of compounded interest over decades that has made certain segments of the population obscenely wealthy in the last 150 years and especially in the globalised world of the last 20 to 30 years, but today, there is just so much capital that all of it will not appreciate unless you take chunks out of the paychecks of the people who actually generate that wealth through their own hands' work. From that perspective, every quid that is paid to workers won't go into somebody's return on investment.
And then you notice very quickly where it has been going from there. Nearly all industrialised countries in the last 25 years have seen countless "job market reforms", ostensibly to make the job markets more flexible, but what they really did was take away most of the workers' share of the wealth that they generate. And it isn't just your actual monthly pay, but also things like job security and other marks of a person's standard of living that have eroded.