Decoding the Covid economy contradiction on Thanksgiving
What may touch more Americans more directly every day, however, is the state of the US economy.
Here is the disconnect between the data and daily life: People are feeling the pinch due to rising costs at the gas pump and the grocery store even when there’s a lot of very good economic news to be thankful for.
I’ve borrowed much of her language for this list of arguably good news, which includes:
- US industrial output is racing ahead above pre-pandemic levels.
- Auto manufacturing bounced back last month and factory output would have been even stronger if not for hiccups in the corporate supply chain.
- Corporate profits are enviable and big companies are navigating supply chain woes, passing along higher costs to customers and even padding their profit margins along the way.
- The biggest publicly traded companies have bigger profit margins today than before the pandemic, and your retirement account probably shows it.
- The Dow is up 17% this year and the S&P 500 is up 25%. If you step back farther since the market crashed in 2020, some averages have doubled.
- Workers have the upper hand. You’ve heard it called the “Great Resignation” — Americans quitting their jobs in record numbers. In September, 4.4 million jumped ship, and economists say many are taking better jobs with higher pay and starting bonuses.
- Paychecks are fatter after years of sluggish wage growth, especially for low-wage workers. Wage growth is nearing 5%.
- Americans are saving. Thanks to higher pay, Covid-19 stimulus checks and child tax credits, Americans have an excess $2.3 trillion in savings since the crisis began. JP Morgan says its median checking account balance is 50% higher this year than in 2019.
- The economy is adding jobs. Overall, 5.8 million jobs were added this year.
There is certainly a contradiction here if the national mood is down while the economic indicators are up.
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