ICYMI: CNN Analysis Highlights How Americans Have Come Out Ahead Economically in the Pandemic
According to a new analysis of economic reports published today by CNN, the majority of Americans have come out of the pandemic stronger economically. For example, analysis from economists Thomas Blanchet, Emmanuel Saez, and Gabriel Zucman found that between December 2019 and December 2021, Americans’ disposable income increased by 5.3%, after accounting for inflation. For the bottom 50% of earners, real disposable income increased by even more.
"For most people," said Michael Strain, the director of economic policy studies at the right-leaning American Enterprise Institute, "the current economic situation is good."
These results underscore the effectiveness of the American Rescue plan and the Biden Administration's ongoing efforts to recover from the pandemic and create an economy that provides prosperity for all Americans.
Read more below:
CNN: Most Americans have come out ahead economically in the pandemic, despite inflation
[John Harwood, 2/13/22]
Public discontent with America's pandemic-battered economy obscures the good news: Even after inflation, most of the country has been coming out ahead.
Red-hot demand for labor means lower-income workers can command wage increases that outpace rising prices. So can middle-income workers who switch jobs.
Relief checks approved by lawmakers of both parties and sent out by Presidents Donald Trump and Joe Biden have given the majority of households a cushion. Those higher up the income scale have seen handsome increases in the values of their homes and investment assets.
Even those who fault Biden's policies for exacerbating inflation risks acknowledge that, right now, the pandemic economy continues to offer large, underappreciated rewards.
"For most people," concludes Michael Strain, who directs economic policy studies at the right-leaning American Enterprise Institute, "the current economic situation is good."
At realtimeinequality.org, economists at the University of California-Berkeley estimate that disposable income for Americans overall increased by 5.3% after inflation from December 2019 to December 2021. Using that measure, which includes the effects of both labor income and Covid relief payments, the bottom 50% of earners saw their disposable income rise by 10.9%, compared with 3.8% for the middle 40% and 4.4% for the top 10%.
Examining changes in wages alone, Arin Dube of the University of Massachusetts-Amherst estimates that two-thirds of American workers have seen their wages go up after accounting for inflation over the last two years. Over just the last year -- when inflation accelerated substantially -- roughly one-third of workers have come out ahead, Dube says.
Outsized gains at the bottom of the income scale chip away at inequality and create opportunity for younger workers who fill many lower-skill, lower-paying jobs. The labor market is running hot enough that millions of Americans keep quitting their jobs for higher-paying new ones in what White House economist Bharat Ramamurti calls "The Great Upgrade."
Joseph R. Biden, ICYMI: CNN Analysis Highlights How Americans Have Come Out Ahead Economically in the Pandemic Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/354554