In addition, unit labor costs have declined sharply over the past year due to the combination of unusually rapid productivity growth and slowing labor compensation growth (Chart 28). (newyorkfed.org)
Very simply, because labor compensation - which is also mean - reverting - has stagnated (though that's started to change in recent months, both in the U.S. and internationally, thanks to relatively low unemployment). (hussmanfunds.com)
Thanks to unusually high debt levels and unusually low labor compensation in recent years, the earnings peak in 2007 was based on profit margins that were about 50 % above the historical average, and which have now collapsed. (hussman.net)