Higher profits equal higher wages.
Really? Higher profits now days equal higher bonuses for top management with stagnant wages for all the other employees and stagnant dividends for shareholders. Of course lower profits often equal higher bonuses for top management with stagnant wages and layoffs for other employees and smaller dividends or no for shareholders.
Corporate governance is broken in part because professional managers have suborned Congress and the SEC into diminishing the power of shareholders over corporate governance and in part because most shares are now held indirectly in mutual funds, pension funds or by other corporations, and are thus not voted by their ultimate beneficial owners, but by other professional managers, who vote their own guild-interest as managers ahead of the interests of the beneficial owners.
It is part of what I call the Era of Bad Stewards: those with fiduciary responsibility for the good or goods of others seeing their position as existing for their own enrichment or benefit, rather than that those they in theory are paid to serve.
In the corporate setting harms lower level employees as much as it harms shareholders because executive pay packages are negotiated to reward short-term performance (or ignore performance and let the executive line his pockets regardless -- think "golden parachute" if you doubt such compensation packages exist), so pursuing the long-term gain in productivity from sharing the benefits of productivity increases with the employees in the from of higher wages -- something the actual beneficial owner might wisely pursue -- is not encouraged, while short-term improvements to the bottom line by not doing so are. And professional managers, who set each other's pay packages these days, rather than the shareholders doing it, aren't going to willingly tie each other's compensation to long-term performance, since long-term performance is harder to accomplish than meeting short-term goals that can easily be met by clever accounting and not paying the employees more.