Where's the money going?
Yet another economist (this time, Tyler Cowen) wrote an article on the recurrent theme The Jobs Are There. Where Are the Wages? -- The U.S. just completed one of its worst decades ever for payroll growth.
But really, what employees get from their employers hasn't done that badly. From elsewhere: "One recent study shows that, between 1970 and 2016, the earnings that laborers received fell twenty-one per cent. But their total compensation, taken to include the cost of their benefits (in particular, health care), rose sixty-eight per cent." That latter number is 1.1% per year, which isn't bad historically. What workers are getting is not money but high-priced medical care.
You could argue that the US medical industry is particularly inefficient at delivering health for money, and you'd be right. But then, it seems that this is because the US medical industry pays particular attention to what the customers want. One recent study determined that patients' ratings of hospitals was entirely uncorrelated with medical outcomes, but was strongly correlated with "the concierge experience". And as has been true throughout history, the rich get doctors who have good bedside manner, not doctors who are particularly effective. What makes European socialist medical systems so efficient in delivering health is that they are run by bureaucrats who care about medical outcomes, but don't care much about patients' concierge experiences.
But really, what employees get from their employers hasn't done that badly. From elsewhere: "One recent study shows that, between 1970 and 2016, the earnings that laborers received fell twenty-one per cent. But their total compensation, taken to include the cost of their benefits (in particular, health care), rose sixty-eight per cent." That latter number is 1.1% per year, which isn't bad historically. What workers are getting is not money but high-priced medical care.
You could argue that the US medical industry is particularly inefficient at delivering health for money, and you'd be right. But then, it seems that this is because the US medical industry pays particular attention to what the customers want. One recent study determined that patients' ratings of hospitals was entirely uncorrelated with medical outcomes, but was strongly correlated with "the concierge experience". And as has been true throughout history, the rich get doctors who have good bedside manner, not doctors who are particularly effective. What makes European socialist medical systems so efficient in delivering health is that they are run by bureaucrats who care about medical outcomes, but don't care much about patients' concierge experiences.