You hear it in the press and on the news almost daily: wages are stagnant and need to go up. Well, the latest reports on personal income and spending, and the report on the Employment Cost Index, are showing two increases. Unfortunately, those increases are far from robust, considering that unemployment is nearly down to 5% in America. The September reading for personal income and spending was less robust than the third quarter’s Employment Cost Index.
Personal income was up 0.1% in the month of September, just shy of the 0.2% projected by Bloomberg. Consumer spending was up 0.1%, versus a 0.2% gain expected by Bloomberg. The PCE price index was lower than expected, with a 0.1% gain, and was flat on a year-over-year basis with a 1.3% reading.
The Employment Cost Index was up 0.6% in the third quarter of 2015. That matched the Bloomberg consensus. What matters here is that gain in the index was a mere 0.2% in the second quarter of this year and was up by 0.7% in the first quarter.
Wages and salaries were up by 0.6%, and the cost of benefits was up by 0.5% in the third quarter. On a year-over-year basis, the ECO is up 2.0%. Of that 2% gain, the wages and salaries component was up by 2.1% and the benefits component was up 1.8%.
The Federal Reserve is hoping for inflation of 2.0% to 2.5%. So far, evidence of anything close to that level remains more than elusive. Now you are seeing more and more evidence why there is only one Federal Reserve president, of the 10 FOMC members, who is voting to raise interest rates.
ALSO READ: The 10 Most Profitable Companies in the World
The #1 Thing to Do Before You Claim Social Security (Sponsor)
Choosing the right (or wrong) time to claim Social Security can dramatically change your retirement. So, before making one of the biggest decisions of your financial life, it’s a smart idea to get an extra set of eyes on your complete financial situation.
A financial advisor can help you decide the right Social Security option for you and your family. Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you.
Click here to match with up to 3 financial pros who would be excited to help you optimize your Social Security outcomes.
Have questions about retirement or personal finance? Email us at [email protected]!
By emailing your questions to 24/7 Wall St., you agree to have them published anonymously on a673b.bigscoots-temp.com.
By submitting your story, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.
Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.
Latest from 24/7
