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Yahoo! UK and Ireland:
Pay rises are making a comeback - here's how we make sure they stay

10 December 2013

Greedy capitalists are sometimes also blamed for falling wages. That is nonsense. In many other countries capital has grabbed a greater share of the economic pie in recent years. However, this has not happened in the UK, a vitally important but almost entirely overlooked fact. Over the past quarter of a century, the share of GDP going to employees in wages, salaries, pension contributions, benefits and social costs has remained roughly the same. It has averaged 54pc of GDP and varied from 51pc in 1996 to 56pc in 1991. When including the self-employed, the share has also remained constant, averaging 59pc (in a 57pc to 61pc range). This is extremely important data, first revealed in a ground-breaking paper by Joao Paulo Pessoa and John Van Reenen of the London School of Economics.

This article was published online by Yahoo! UK and Ireland on December 10, 2013
Link to article here

Related publications
Wage growth and productivity growth: the myth and reality of 'decoupling', Joao Paulo Pessoa and John Van Reenen. Article in CentrePiece Volume 18, Issue 2, Autumn 2013
'Decoupling of Wage Growth and Productivity Growth? Myth and Reality', Joao Paulo Pessoa and John Van Reenen, Centre for Economic Performance Discussion Paper No.1246, October 2013

Related links
Joao Paulo Pessoa webpage
John Van Reenen webpage
Productivity and Innovation Programme webpage

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