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Pendulum swinging back toward workers

January 2, 2007
A global trend toward workers’ demanding a larger portion of their nations' prosperity might result in an increase in the minimum wage and easing of restrictions on union organizing in the U.S., according to Bloomberg.

Workers in Group of Seven industrialized nations are pressuring companies and governments after their share of national income eroded to 54 percent last year, a record low. In the past five years, the share of national income in the seven countries going to profits swelled to 16 percent from 10 percent.

Morgan Stanley chief global economist Stephen Roach predicts labor’s share of national income could rise half a percentage point a year for three to five years.

If workers succeed in gathering a bigger piece of the pie, inflation and interest rates could rise.
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