As we come to the closing weeks of the year, the U.S. economy is remarkably strong and the unemployment rate is historically low.
Gone are the summer’s fears of a 2020 recession. Measure after measure confirms what President Trump has been toting about the strength of this economy. Policies that reduced taxes and deregulated industries are spurring our economy forward.
Here are five reasons economic analysts think this economy is good and getting better:
Unemployment is near a 50-year low. The unemployment rate hit 3.5 percent in November 2019, the lowest rate in five decades. For 21 consecutive months, the unemployment rate has been at or below 4 percent. Even more, various demographics have seen record-low unemployment this year: African American, Asians, Hispanics, American Indians, veterans, those without a high school degree, and persons with disabilities, among others. Americans have jobs and can find jobs. Not just college-educated professionals but those who have been sidelined by criminal records and opioid addiction.
Consumers are spending massively. Consumer spending on everything from cars to clothes has remained strong this year. This holiday shopping season is expected to be one of the strongest with spending rising between 3.8 and 4.2 percent from last year and beating an average 3.7 percent increase over the past five years. Consumer sentiment in December rebounded to match August levels just as the fears of a recession in 2020 began to circulate. A big driver of consumer sentiment is the strong labor market. Tariffs and pending trade deals have weighed consumer sentiment down, but the finalization of trad deals will erode those fears.
Home sales have rebounded. Americans are buying and refinancing their homes, taking advantage of several interest rate cuts by the Federal Reserve this year. This is a turnaround from the summer when housing purchases slowed, an important economic driver for our economy. Inventory of homes for sale remains low and prices are high in many urban areas, but that is not stopping Americans from investing in homeownership.
Trade deals are (almost) done. Over the past few days we have come close to two major trade deals being completed. The United States-Mexico-Canada Agreement (USMCA) is set to be voted on this week by the House of Representatives with both parties agreeing that this deal with our biggest trading partners will be approved. Signing the USMCA is expected to generate $1.2 trillion worth of trade. President Trump has also announced a partial deal with China that ends increased tariffs set to take effect over the weekend. These deals are important because they ensure certainty for U.S. businesses which make decisions about investment and hiring depending on trade certainty (among other factors).
The stock market keeps breaking records. Today, the Dow Jones Industrial market hit a new record high marking an extraordinary rise from 19,600 at the end of 2016 to 28,322 today. For the half of Americans who own stocks directly or as part of a fund like a mutual fund or 401k according to the Federal Reserve Board, this means an increase in their assets and wealth which gives them greater confidence about their future.
Anything can happen to trigger an economic pull back and even a recession such as a national disaster, a significant terrorist attack, a financial collapse, or trade concerns, but by various measures our economy is moving ahead smoothly.
This bodes well for Americans looking to start businesses, invest in their futures, or find work employment. We are #betteroffow.