As much as possible I try to stick to issues and stay away from personalities on this blog. But I have occasionally criticized President Trump for various failings such as ignoring our rapidly growing national debt.
Several recent posts have pointed out that the American middle class is thriving and expanding as a proportion of the overall population, see here and here.
The latest news this week about the U.S. economy is also very good. Consider:
- The overall unemployment rate is now 3.6%, the 20th consecutive month at or below 4%.
- The average job growth for 2019 is now (as of November 1) 167,000 per month, amazingly good considering how low the unemployment rate is.
- The employment ratio for prime-age workers, aged 25 to 54, is up to 80.3%, the highest since January 2007 (see chart) and the overall labor participation rate is up to 63.3% as well.
- The unemployment rate for African/Americans is now 5.4%, the lowest since records have been kept, and the third month in a row at 5.5% or less.
- Average hourly earnings are $28.18 per hour, 3% higher than a year ago.
- According to the Sahm Signal (When the three month average of the jobless rate has risen .5 percentage points from its previous 12 month low, the U.S. is in recession), the U.S. has not entered a recession.
“All of this bodes well for consumer spending going forward and makes a near-term recession even more unlikely.”
Summary. The U.S. economy is now humming along quite nicely, even if GDP has returned (as of Nov 1) to 2% annual growth. As long as the prime-age and overall labor force participation ratios continue to grow, consumer spending should continue to be strong enough to keep the economy out of recession.
At what cost Jack? Dollars and cents aren’t the only measure of a successful society.
Faster economic growth means more jobs means higher pay. This is not sufficient for a successful society but it is necessary for one.