Corporate profits are lower, but this time around, companies aren’t responding by laying off workers. It hints at a further power shift from capital to labour.
at last week’s Financial Review Property Summit bounced around the planet.
Strategas has been investigating and finds two likely causes. One is that the decline in corporate profits has been modest, so companies are prepared to absorb weaker margins to keep their workforce intact. And over the course of this Northern summer, unions have had some big wins, he says. The Teamsters negotiated rich labour contracts across several industries. Trennert is watching developments in Detroit, where the United Auto Workers are set to strike. On Friday, the historic industrial action began at the Ford, General Motors and Stellantis factories.
So, the tensions between capital and labour that have simmered for decades, if not centuries, are rising again.believes we’re only at the start. Last week, he described the issue of “income inequality” as the poison of the capitalist system.He says reducing inequality is important for a healthy society, and to improve it, governments need to consider higher taxes or unions need more influence.