Take the total weekly payroll paid to America's production and nonsupervisory workers: line workers, nurses, drivers, retail and restaurant staff, roughly four in five private-sector jobs. That payroll pool grows only when some combination of more people working, more hours, and higher pay is true. Subtract the inflation those workers actually face and you have the Main Street Indicator: the year-over-year growth of Main Street's real paycheck pool. Above zero, Main Street is gaining ground. Below zero, it is losing ground, whatever GDP says.
GDP can grow while paychecks do not. Headline growth with a falling labor share is exactly the mix that reads as prosperity in the data and feels like decline on the ground. This indicator makes that divergence visible one jobs report at a time.
BLS Index of Aggregate Weekly Payrolls of Production and Nonsupervisory Employees, Total Private (CES0500000035), percent change from year ago, minus CPI-U inflation (CPIAUCSL), percent change from year ago. Monthly from 1965. CPI rather than PCE is deliberate: it is closer to the basket households perceive. Two honest limits: the series is establishment payrolls, so gig and 1099 work is outside it, and it is an aggregate, so a boom at the 90th wage percentile can mask erosion below. Both biases run the same direction; if anything the indicator flatters the trend. Updated monthly with the BLS Employment Situation release. Source data: U.S. Bureau of Labor Statistics via FRED (St. Louis Fed).
Suggested citation: Goren, Amir. 2026. "The Main Street Indicator." amirgoren.org/indicators. Data: U.S. Bureau of Labor Statistics, Index of Aggregate Weekly Payrolls of Production and Nonsupervisory Employees (CES0500000035) and CPI-U (CPIAUCSL), via FRED, Federal Reserve Bank of St. Louis.
Please cite the date you accessed the chart; it updates with each jobs and CPI release.
The rule: labor's share of what corporations produce is falling, hours worked are flat, and there is no recession. Signal: ON since the third quarter of 2025.
Nonfinancial corporations paid 54.6 percent of their value added as compensation in the second quarter of 2026, the lowest since 1947. The share falls in most expansions, as profits recover faster than pay, but normally while firms are still adding hours. Add flat hours, meaning hours worked grew less than 0.5 percent a year over the previous three years, and since 1974 only the four quarters from 2025 Q3 to 2026 Q2 qualify. Over those three years hours grew 0.3 percent a year, output per hour 2.7 percent, and pay covered 79 percent of what prices plus productivity would have paid. Since 2000 the share has fallen 10.5 points, and 90 percent of that went to profits.
By industry, 2022-2025. Where labor's share of value added fell most (points): finance and insurance -7.2, wholesale trade -3.3, health care and social assistance -1.9, information -1.6, administrative and support -1.5; all private industries -0.9. Where output grew while jobs stayed flat (output growth above jobs growth plus the industry's own 2005-2019 productivity gain, jobs under 0.5 percent a year): information (output +8.1, jobs -2.2 percent a year), retail (+4.6, -0.2), finance and insurance (+3.4, +0.4), wholesale (+2.4, +0.3), manufacturing (+1.7, -0.4).
What it does not say. It names a pattern, not a cause, and does not attribute it to AI. In past cycles the share has followed hours with a lag of about a year; hours picked up in 2026, so if the old relation holds the decline should slow by mid-2027. A share that keeps falling after hours recover would be stronger evidence of displacement; this rule switches off when hours recover, so I will report that test separately.
Method. Rule frozen October 4, 2026; later quarters are scored by it unchanged, and any change gets a new version number. Data: BEA nonfinancial corporate compensation and gross value added (September 30, 2026); BLS nonfinancial corporate hours (September 3, 2026 release); NBER recession dates; BEA industry value added and compensation, BEA industry employees, annual. Limits: the hours cap was set after seeing the data and the start date sits close to it; the size of the current decline is not unusual; real output in finance and information is poorly measured.
Paper: Classification Instruments Fail: A Pigouvian Correction for the Direction of AI Adoption. https://doi.org/10.2139/ssrn.7107538
Amir Goren, independent researcher. Contact: goren.amir@gmail.com.