Summary
Relative wages refers to the proportional share of output, as against profits
Even where nominal wages and real wages rise, relative wages can fall
In conditions of expanding output, driven by rising social productivity, the portion going to wages rises, but its proportion falls.
Relative wages tend to fall during periods of stagnation and recovery, when, as a result of intensive accumulation, social productivity rises more quickly, and the rate of surplus value rises, amid conditions of a relative surplus population.
Relative wages rise during periods of boom and crisis, when there is extensive accumulation, slowing social productivity, and a rising demand for labour, which causes wages to rise, eventually squeezing profits to an extent that causes a crisis of overproduction of capital.
Capital responds to such a crisis by engaging in a new technological revolution, which replaces labour with fixed capital, sharply raises productivity, creates a relative surplus population, starts a new phase of intensive accumulation, marked by economic stagnation and slower growth of gross output, in which net output grows faster, leading to increased profit share.
As Marx sets out in Wage-Labour and Capital, the best conditions for workers exist in that first period where the economy grows more rapidly, and the demand for labour rises sharply, but those very conditions lead to the crisis of overproduction of capital, and so to the position of the workers being again undermined.
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