Corporate Profits (% GDP)

After-tax corporate profits as a percentage of GDP — the share of economic output captured by the corporate sector. Currently near cycle highs above 11%, well above the historical average of 7–8%. Elevated profit margins reflect post-pandemic pricing power, but compress as real wages recover and revenue growth slows. A sustained decline reduces buyback capacity, earnings growth expectations, and ultimately equity valuations.

This indicator is computed by MacroLab from two FRED series: CP divided by GDP, scaled by × 100. Both input series are sourced from the Federal Reserve Economic Data (FRED) database.