Part 3: How much (more) money we're making:
Bottom Line: In today's third story breaking down the employment report from January we'll explore real incomes. The average hourly wage for all Americans is currently $26.74. Here are a couple of highlights:
+1 cents per hour over the past month
+2.9% year over year
+3.6% on an annualized basis
Average weekly hours worked - 34.3
There's lots of good stuff here. The impact of the improved and improving economy really started to show up in paychecks in January. For those who've been employed the most frustrating and challenging aspect of the jobs economy has been the lack of wage growth. For years people have been patiently waiting to see hard work pay off and we're beginning to see meaningful follow through as we advanced into 2018. With the average American earning 2.9% more in January of 2018 as compared to January of 2017 - we had our best year over year increase in eight years. What's notable, unlike eight years ago, is the substantially lower unemployment rate. In January of 2010 we lost 20,000 jobs for the month and the unemployment rate was 9.7% compared to 4.1% today. So, in reality, we didn't have real incomes rising for positive economic reasons eight years ago, we had those who were still employed averaging higher incomes as those on the lower end of the earning scale were more negatively impacted. This is the win-win-win of starts to the year.
- We've added nearly 2.2 million jobs over the past year
- Unemployment is the lowest in 17 years & two months
- & we're seeing real incomes rise by nearly 3% year over year with the January pacing indicting growth of 3.6% for the year
So, what's the difference between the 2.9% year over year wage growth and the 3.6% increase pace? Bonuses. Employees are earning and average of 2.9% more based on average hourly wages. Once you factor in bonuses already paid that jump to 3.6% & that's before the impact of tax reform which will save the average full-time employed person about $1,980 additionally. There's a lot to feel great about from this month's report.
Until next month...