Are workers hitting rock bottom?

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Recent revisions to US data put the labor share of GDP at the lowest level since records began (in 1947). The declining trend is also seen elsewhere. This shift is taking place amid ongoing structural labor market change.
The declining workers’ share of economic activity could be caused by the economy’s changing composition. If more labor-intensive sectors contribute less to growth, and less labor-intensive sectors contribute more to growth, the labor share of GDP would decline. Research from the Federal Reserve suggests this is not happening.
There are two other possible structural drivers. As Japan has demonstrated, an aging population means machines replace labor. Older people get their income from pensions, meaning investments, meaning profits. The decline in the labor share of GDP is not necessarily a bad thing for the older citizen.
In addition, the rise of self-employment complicates the measurement of the labor share of GDP. Someone who is self-employed may pay themselves a wage (as a worker) and a dividend (as sole shareholder in the business). Tax structures may favor the latter over the former. With the growth in small business numbers since the pandemic, some of the rise in profit share of GDP may be wages in disguise.