Barbara Garson's argument rests on the claim that from 1971 to 2007, worker productivity soared while inflation-adjusted worker well-being barely budged. This premise is faulty.
Garson uses wages rather than total compensation (which has grown far faster), dramatically understating workers' real "pay" growth. Further, the index used to deflate wages substantially over-adjusts for inflation compared to productivity measures, creating a huge measurement bias.
In fact, total employee compensation represented 62% of national income in the 1960s, 66% in 1970 and 64% in 2006. There has been no massive erosion in worker compensation.