Part 3 - How much (more) money we're making - November
Bottom Line: In today's third story breaking down the employment report we'll explore real incomes. The average hourly wage for all Americans is currently $27.35 and with an average work week of 34.4 hours the average income is now $48,976, a decrease of $53 from a month ago. Here are the highlights:
- +5 cents per hour (month over month)
- Real incomes have risen by $1,345 year over year
- +3.0% year over year increase in hourly earnings
There’s a lot to like here except for one small fly in the ointment. Average hours worked dropped a tenth and made what would have been a great month for making more money into just a solid one. What’s exciting is that we’re continuing to see record wages month after month and for the second consecutive month we’re continuing to see 3%+ gains in base income year over year for the first time since the recession. With most of the economy being based on consumer spending and with the average American making 3%+ more – there's plenty of room to think we can maintain a 3%+ growth economy for now.
What’s more is that by the time you factor in bonuses and the benefit of the tax cuts, about $1800 per full-time employed person this year, the hourly increase is just the tip of the spear.
By the time that’s all added up together here’s what you get...
The average net take home pay year over year has increased by approx. 6.9%
That remains the best in about 32 years and provides every reason to believe that we’ll be able to maintain our economic momentum with the best economic growth in a generation to finish up 2018. For most that claim not to have seen the benefit of the tax cuts – it's because withholding adjustments haven't been appropriately made – not because they're not set to receive the benefit. There’s an estimated 30 million people in this category. That'll all be reconciled by tax time next year but it's a reminder to look into making adjustments sooner if that's your situation.
Here’s the bottom line. We still have one of the best job markets in the history of our country, in the best economy in a generation. For many demographics, including black unemployment, it is the best ever. Additionally, wages are rising, bonuses are rising, and the economy appears to be on track with some of the biggest gains still coming in manufacturing. It’s been 13 years since we had an economy, we could even compare this one to, but there are vast differences between now and then. For a whole generation of adults, Millennials, they’re finally experiencing what our economy and country has to offer.
Until next month...