Labor Day is the one holiday with a thesis: that the people who do the work deserve a share of what the work produces. So today, instead of speeches, this newsletter offers a ledger. Every number below is from federal data or named researchers, most of it published in the past few weeks. Together they describe a year in which American workers kept working, kept the economy out of recession, and watched their leverage shrink from every direction at once: raises decelerating to five year lows, prices fed by tariffs, a shrinking share of corporate income, and the federal referee for workplace rights sidelined for a year and returned to the field smaller and friendlier to employers. Tomorrow morning, Canada’s retaliatory tariffs land on American steel, dairy, and farm equipment. The holiday, in other words, is the quiet day between chapters.
The Paycheck
Start with the number on the pay stub. Annual wage growth was 3.2 percent as of July, and Friday’s August jobs report showed monthly wage gains of 0.3 percent, a pace economists project pulls the annual figure to about 3 percent, the softest since May 2021. Three years ago, raises ran roughly twice that. Against prices, the race is essentially a tie: from July 2025 to July 2026, nominal wages grew 3.5 percent while inflation ran 3.4 percent, a margin of nine hundredths of a percentage point. By the government’s Employment Cost Index, inflation adjusted wages and salaries for private industry workers actually fell 0.4 percent over the year through June. Economists cited in this newsletter’s prior reporting trace 0.6 percentage points of the price level directly to the tariffs, which means a meaningful slice of the inflation eating those raises is policy, not weather.
Then there is the deeper number, the one that explains why so many people feel the economy is not working for them even when the headlines are decent. Workers received 71.3 percent of corporate sector income in the first quarter of 2026, down from 77.8 percent at the start of 2020, per Economic Policy Institute analysis reported by CBS News. That is the labor share: the fraction of what companies generate that goes to the people who generate it. It is near its lowest point since the Second World War. The rest goes to profits. When the president says the economy is booming, that is the part that is booming.
The Job Market
The jobs picture improved on Friday, and honestly so: August added 162,000 jobs, and July’s reported loss was revised to a gain. But one strong month sits on top of a year that averaged 34,000 jobs a month, in what economists call a low hire, low fire market: layoffs are rare, and so are offers. For workers, that has a specific meaning. Leverage in a labor market comes from the ability to leave. When hiring stalls, job switching stalls, and the premium workers earn by changing jobs, the raise you get by walking, goes with it. Labor force participation has fallen 0.7 percentage points since January, meaning hundreds of thousands of people stopped looking altogether. Black unemployment stood at 6.3 percent in July, well above the 4.1 percent national rate. A cooling labor market is not evenly cool.
The Union Difference
The clearest data on what leverage is worth comes from the workers who kept theirs. Union members earned median weekly pay of 1,404 dollars in 2025; nonunion workers earned 1,174 dollars, about 84 cents on the union dollar, per the Bureau of Labor Statistics. Controlling for occupation, industry, and demographics, the Economic Policy Institute puts the union wage premium at 12.8 percent: the same worker, in the same kind of job, earns about an eighth more under a union contract, before counting the larger gaps in health coverage and retirement benefits. Union membership held at 10 percent of the workforce in 2025, and EPI reports the number of union members actually grew last year, a resolve worth noting in a market this soft. On the one day of the year named for labor, the premium is the point: collective bargaining is the difference between wages set by leverage and wages set by whatever the market will bear in a market where the bearing is thin.
The Referee Left the Field
Workplace rights in America run through a small federal agency called the National Labor Relations Board, the body that supervises union elections and prosecutes employers who illegally fire organizers or refuse to bargain. Here is what happened to it. In January 2025, the president removed board member Gwynne Wilcox without cause, something no president had done in the agency’s 90 year history. That removal left the board without the quorum it needs to decide cases, and for nearly a year, workplace disputes simply stacked up with no one empowered to rule on them. In January of this year the Senate confirmed the president’s replacement slate, 53 to 43, restoring a quorum with a Republican majority and a new general counsel, Crystal Carey, who, per reporting by The American Prospect, has moved to raise the burden on workers filing complaints in the first place. Meanwhile the agency itself has shrunk: more than 150 employees have left over the past year against eight hires, a cut of more than a tenth of its workforce, per Bloomberg Law, hollowing out its ability to dig through the backlog the quorum crisis created. The rules still exist. The capacity to enforce them is what changed.
Tomorrow Morning
The holiday ends and the next chapter starts within hours of each other. Canada’s retaliatory tariffs, covering more than 700 product categories worth roughly 27.6 billion Canadian dollars, take effect Tuesday, September 8, aimed at American steel, dairy, and farm equipment. The workers most exposed are the ones this holiday was invented for: steelworkers, dairy farmers, machinists, the manufacturing employment that has already been drifting down in the monthly data. The same morning, the administration’s response to the mail voting litigation is due at the Supreme Court. And the following week, on September 16, the Federal Reserve decides whether to raise interest rates to fight an inflation that tariffs helped feed, a decision that lands on every adjustable loan and credit card balance in the country. None of these are abstractions. They are the next entries in the ledger.
Where Things Stand
Fifty seven days before the election, the ledger reads: raises at five year lows, real wages flat to falling, labor’s share of corporate income near a postwar low, one good jobs month in a slow year, a union premium of 12.8 percent for the one worker in ten who has it, a workplace rights agency restored to life smaller and less welcoming to complaints, and a trade war arriving at the factory gate in the morning. Workers did their part this year; the returns went elsewhere. That is not a slogan. It is arithmetic, and every voter gets to check it.
Sources: Bureau of Labor Statistics (Employment Situation, July and August 2026; Employment Cost Index, Q2 2026; Union Members, 2025; Real Earnings); Economic Policy Institute (union wage premium, unionization report, labor share analysis); CBS News on labor share of corporate income; USAFacts wage and inflation comparison; Pew Research Center; Bloomberg Law and The American Prospect on the National Labor Relations Board; Hunton and Ogletree client alerts on the NLRB quorum; prior TPP reporting on tariff price effects and Canada’s September 8 tariffs.