Commentary

Actual Wage Growth Is 1.9%, But You Won't Hear That On TV News

Think the economy is doing well? Don't believe everything you hear on TV business news networks or Twitter feeds from the President.

“The average American worker is still waiting for the promised economic boom,” according to a recent Vox.comreport.

TV news anchors may talk up the so-called strong economic data -- especially when it comes to historically low unemployment and so-called positive wage growth. But what does this amount to for TV marketers?

In 2018, reports cited wage growth of 3%. But actual wage growth -- when factoring in inflation and cost of living -- is only up 1.9% over the last year.

And when looking at the the bigger picture, real wage growth has fallen 9% since 2006 -- with the Great Recession starting in 2009.

But it’s actually worse than that. After adjusting for inflation, today’s average hourly wage has just about the same purchasing power it did in 1978, according to a Pew Research Center report in August 2018.

What did the Trump Administration tax cut do? 

Just a sugar-high for consumers and corporations alike. For many companies, the tax hike gave them a one-time profitable kick. But quarterly financials have receded.

Consumers aren’t any better off. According to a Gallup Poll earlier this year, nearly half — 48% — of Americans say they believe economic conditions are worsening, up from 45% in December and 36% in November.

Yet financial news networks CNBC, Bloomberg and Fox Business don't focus on this reality. Why? Their perspective is virtually always about hard-core active investors, with a lesser focus on everyday workers who own more passive 401(k)s and IRAs.

Here's the news: The U.S. has historically low unemployment, 3.6% in April, with real GDP up 3.2% in the first quarter of 2019. Real wage growth in 2018? Up an eye-popping 1.9%!  Does that make sense?

And what does this mean financially for TV news networks -- and TV networks overall?

TV marketers are now looking to make key spending decisions for the upfront advertising market. Will consumers have more money to spend ? If so, TV advertisers might need to buy more TV -- or other premium digital media?

This season, continue to scratch your heads, again, over financials, micro- and macro-data, as well as longer-term big TV media spend data -- $20 billion in upfront prime time and $30 billion for all upfront dayparts.

It's just economic-financial data at work -- on screen and off.

 

3 comments about "Actual Wage Growth Is 1.9%, But You Won't Hear That On TV News".
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  1. John Grono from GAP Research, May 28, 2019 at 7:14 p.m.

    As it always was.

  2. Paula Lynn from Who Else Unlimited, May 28, 2019 at 9:49 p.m.

    $50,000 HHI or less will have less to spend. $500,000 HHI more.

  3. Ken Kurtz from creative license, May 29, 2019 at 6:41 a.m.

    Yes, John. No news here. Same as it has always been, and always will be. Things like inflation, and cost of living do cut into great economic numbers like those we've been seeing since 2016, however, those very things have been much higher, and cut more deeply at many other times in our history. Worth noting that the cost of living is higher than it could be in great part to the very forgiving views on illegal immigration here in the US. Flouting the rules of law, and providing sanctuary to anybody, and everybody does cost big bucks (everybody pays more). We are currently attempting to tamp this nonsense down, so that the preponderance of lawbreakers do not make it more difficult for vetted followers of our laws to immigrate LEGALLY, and safely.

    This quote speaks to me...

    “The average American worker is still waiting for the promised economic boom,” according to a recent Vox.comreport.

    It tells me to never be average (no better place in the world to rise above average than the USA). Friedman's opinion that the tax cuts are nothing more than a "sugar high" ignores the fact that this 59 year old has never been more employable, and currently enjoys two great gigs that were unavilable to me during Obama's lethargic eight years.

    Another hint on rising above average. Don't be one of Friedman's bemoaned "everyday workers who own more passive 401(k)s and IRAs." Passive = average. Don't be passive. 

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