Wall Street Journal
By Editorial Board
July 30, 2019
New data show much faster growth in wages and incomes.
Political discourse nowadays is enough to depress anyone, and the media don’t help by ignoring good economic news. But buck up, Americans: Worker wages are growing much faster than previously reported.
The Bureau of Economic Analysis (BEA) on Tuesday published its annual revisions to personal income data, and the surprise was the huge jump in disposable income and employee compensation.
. . . In sum, Americans are earning more and relying less on government. Personal savings estimates were also increased by $217 billion for the last two years and are now $1.3 trillion, which means Americans are socking away more of their earnings.
. . .
The economy barely skirted recession in the final Obama years, and economic policy changed in 2017. Deregulation has unleashed repressed animal spirits, especially in energy. Tax reform has also spurred business investment in new facilities and equipment, which over time should translate into higher worker productivity and wages.
. . .
. . . While Democrats and even some conservatives complain that workers haven’t benefited from tax reform, the evidence suggests otherwise.
Corporate after-tax profits increased by about $220 billion between 2016 and 2018 while employee compensation swelled nearly $1 trillion. Corporate profits declined 2.9% in the first quarter of 2019 even as wages grew at an annual rate of 10.1%. This sure sounds like an economy that is benefiting the 99%.
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