3.3 Wages and profits share

Quarter	2007–08	2008–09	2009–10	2010–11	2011–12
Wages share (a) (b) – per cent

September	55.0	52.3	53.5	52.5	52.7
December	54.8	52.8	53.0	52.5	53.3
March	54.4	52.3	53.0	53.4	54.5
June	53.9	53.1	52.6	52.9	54.7

Annual average	54.6	52.6	53.0	52.8	53.8

Profits share (a) (c) – per cent

September	26.7	29.5	27.0	28.7	29.1
December	26.8	28.6	27.8	28.8	28.2
March	27.0	29.1	27.8	27.7	27.1
June	27.8	27.9	28.8	28.5	26.7

Annual average	27.0	28.8	27.8	28.4	27.8

Key points

The profits share decreased by 0.4 percentage points in the June quarter 2012 while the wages share increased by 0.2 percentage points over the quarter.

The wages share peaked at around 63 per cent in 1974 while the profit share bottomed at just over 15 per cent at the same time.

The wages share and the profits share of total factor income usually exhibit inverse movements and can be subject to large quarterly fluctuations.

What is measured

The income measure of gross domestic product (GDP) can be broken down into total factor income plus taxes less subsidies.

Total factor income is that part of the cost of producing GDP which consists of gross payments to factors of production (labour and capital).

The wage share is the total value of income from labour as a percentage of total factor income.

The profit share is the gross operating surplus (GOS) of corporations as a percentage of total factor income. GOS is a measure of the surplus accruing to owners of capital from processes of production.

Related statistics in this bulletin

3.1 Gross domestic product
3.2 Non-farm gross domestic product
§ 3.4 Household debt and household saving ratios
3.5 Labour productivity

Related publications

RBA, Bulletin
Treasury, Budget papers
OECD, Economic outlook
NAB, Australian outlook and research
Access Economics, Business outlook

(a) Quarterly figures are seasonally adjusted.
(b) Compensation of employees as a proportion of total factor income.
(c) Gross operating surplus of financial and non-financial corporations as a proportion of total factor income.
Source: ABS, Australian national accounts: national income, expenditure and product,
Update 5 December 2012