Job growth in the U.S. has been steady in recent years, as the unemployment rate fell below 5% for the first time since early 2008 last week. With more Americans working, there is more money being spent, and it’s driving the economy, reports MarketWatch staffer Jeffry Bartash.
In 2015, consumer spending rose 3.1% -- the fastest pace since 2005. All this spending should lead to increased wages, economists say, since workers are gradually gaining more bargaining power.
“As the competition to find suitable workers intensifies, employers are feeling the pressure to lift wages,” said Bernard Baumohl, chief global economist at The Economic Outlook Group.
Most signs indicate that the economy is on stable ground. “While there have even been growing whispers about the still-remote chance of a U.S. recession forming this year, the data simply do not support that concern,” asserted Douglas Porter, chief economist at BMO Capital Markets.