What keeps Americans up at night? Hmm, there are many contenders, but here’s what’s not a worry right now: the economy, and most people’s ability to get a job, keep a job or anticipate a raise. Look around, notice all the Now Hiring signs?
Some evidence most of us didn’t expect but ought to celebrate: The U.S. economy is growing at a 4.2 percent clip, far outpacing the 2 percent range of the post-recession era of Barack Obama’s presidency. The unemployment rate is an astonishingly low 3.9 percent. That rate is at a near-record low for African-Americans (6.3 percent) and Hispanics (4.7 percent). Jobless claims, a proxy for layoffs, have tumbled to a 49-year low. Wages are rising, too. Median household income grew 1.8 percent in 2017 to an all-time high of $61,372.
Democrats and Republicans are squabbling about who deserves credit for the good times. Is it President Donald Trump or his predecessor? Both Obama and Trump claim they are responsible, which is how you know the country is doing well. Under Obama, the U.S. recovered from the 2007-09 Great Recession and continued to grow, but expansion has hit a higher gear under Trump. The combination of tax cuts and deregulation is driving business investment and hiring. When employers feel positive about the future, they bet money on it. That’s what’s keeping the economy speeding along.
Capital investment, which reflects spending on buildings and equipment, increased 19 percent in the first half of the year to $341 billion. R&D spending jumped 14 percent. “In the last 25 years, you’ve never had capital spending growth at that level,” Goldman Sachs strategist David Kostin told CNBC.
You can find the same good feeling among small business owners. In July, a small business optimism index from the National Federation of Independent Business hit the highest level in its 45-year history. Shoppers seem happy, too. Consumer confidence is at the highest level since October 2000, according to The Conference Board. About 25 percent of households expect their incomes to rise in the next six months, also the highest level since October 2000.
The biggest worry we’ve seen among employers: Bosses are having trouble finding enough people to hire. Big retailers are starting the seasonal hiring process earlier so they can nab enough employees. Target wants to hire 120,000 seasonal workers, 20 percent more than last year. How big a headache is hiring right now? This comment about the economy jumped out at us: “I almost welcome a slowdown. I can’t find enough workers,” Dan Holtz, an Elkhart, Ind., RV industry supplier, told The New York Times.
Ah, but that which keeps Dan Holtz up at night allows millions of people to slumber. There are 6.9 million U.S. job openings, according to the Labor Department, while 6.2 million out-of-work people are looking for employment. There are skill mismatches so not everyone will get his or her ideal job.
Still, the country is in excellent economic shape. When Gallup recently asked Americans to identify the most important problem facing the U.S., just 12 percent cite some aspect of the economy. Just 12 percent. If Americans aren’t complaining they’ve got to be satisfied.
What’s unclear is how expansion and job growth will factor into this fall’s midterm elections. Republicans seem unable to galvanize behind a message that their tending of the economy is good for the country. Democrats want to change the subject, or relitigate the question of whether Trump or Obama should get credit. Come Nov. 6, American voters will have their say.
