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Today's Facts

REAL WAGES STILL DOWN 1.9% SINCE BIDEN TOOK OFFICE

Key Points:

  • Real average hourly earnings are hourly earnings adjusted for inflation. They are one measure of real wages, which represent the economic return to work.
  • Despite average hourly earnings trending up, wages are still down after adjusting for inflation.
  • The Consumer Price Index (CPI) fell 0.1% in June from May and is up 3.0% in the last year.
  • Real average hourly earnings have fallen from $35.69 in January 2021 to $35.00 in June 2024, a 1.9% decline.
  • Overall, prices have increased 19.2% since Biden took office in January 2021.

INFLATION DECLINED FOR FIRST TIME SINCE MAY 2020, CORE PRICES STILL RISING

Key Points:

  • The Consumer Price Index (CPI) fell 0.1% in June, after no change in May.
  • CPI increased 3.0% from a year ago, down from 3.3% in May and consensus of 3.1%.
  • CPI has remained above 3% for 39 consecutive months dating back to April 2021.
  • The index for shelter rose 0.2% and the energy index fell 2.0% over the month.
  • The index for gasoline fell 3.8% in June, after declining 3.6% in May, more than offsetting an increase in shelter.
  • The index for food at home rose 0.1% over the month while the index for food away from home rose 0.4%.
  • The core CPI, which excludes food and energy, rose 0.1% in June and is up 3.3% from the previous year.
  • The energy index is up 1.0%, the food index is up 2.2%, and shelter is up 5.2% from the previous year.
  • The Right Facts will continue to monitor CPI.

JUNE ADDED 206K JOBS BUT REVISIONS AND RISING UNEMPLOYMENT BRING CONCERNS

Key Points:

  • Total nonfarm payroll employment rose by 206,000 in June and the unemployment rate rose 0.1% to 4.1%.
  • Consensus among economists was a gain of 190,000 jobs.
  • The change in total nonfarm payroll employment for April was revised down by 57,000, from +165,000 to +108,000, and the change for May was revised down by 54,000, from +272,000 to +218,000. With these revisions, employment in April and May combined is 111,000 lower than previously reported.
  • Government employment rose by 70,000 in June, health care added 49,000 jobs, employment in social assistance increased by 34,000, and construction added 27,000 jobs.
  • In June, average hourly earnings for all employees on private nonfarm payrolls rose by $0.10 to $35.00.
  • The average workweek for all private employees remained at 34.3 hours in June for the third consecutive month.
  • The labor force participation rate changed little at 62.6% and is 0.8% below its February 2020 level.
  • In June, the unemployed population rose to 6.8 million but there were 8.1 million job openings in May.

JOB OPENINGS RISE IN MAY, APRIL REVISED DOWN

Key Points:

  • The number of available jobs since May 2021 continues to outnumber Americans looking for work.
  • Job openings rose from 7.9 million in April to 8.1 million in May
  • There are 1.2 million fewer job openings than May 2023.
  • In May, job openings decreased in accommodation and food services (-147,000) and in private educational services (-34,000). The number of job openings increased in state and local government, excluding education (+117,000), durable goods manufacturing (+97,000), and federal government (+37,000).
  • The U.S. added 272,000 jobs in May and there were 6.6 million people unemployed.
  • The number of job openings for April was revised down by 140,000 to 7.9 million, the number of hires was revised down by 25,000 to 5.6 million, and the number of total separations was revised down by 35,000 to 5.3 million.
  • In May, the number of hires was little changed at 5.8 million. Over the year, hires were down by 415,000.
  • The number of total separations in May changed little at 5.4 million. This measure was down by 424,000 over the year.
  • Within separations, quits (3.5 million) and layoffs and discharges (1.7 million) changed little.
  • In May, the number of quits was little changed at 3.5 million, and the rate was 2.2% for the seventh month in a row.
  • In May, the number of layoffs and discharges changed little at 1.7 million, and the rate remained unchanged at 1.0%.
  • The labor force participation rate fell to 62.5% in May and is 0.9% below its February 2020 level.
  • The Right Facts will continue to monitor unemployment and job openings.

KEY FED MEASURE SHOWS INFLATION ROSE 2.6% IN MAY FROM A YEAR AGO

Key Points:

  • U.S. consumer spending rose by 0.2%, or $47.8 billion, in May, up from 0.1% in April.
  • Personal income increased by 0.5%, or $114.1 billion, in May, after rising 0.3% in April.
  • The overall personal consumption expenditures price index was unchanged in May and is up 2.6% from a year prior.
  • The core personal consumption expenditures price index, which excludes food and energy, rose 0.1% in May and is up 2.6% from a year prior.
  • The Right Facts will continue to monitor spending, prices, and income.

NEW HOME SALES SLUMP 11.3% IN MAY TO 6-MONTH LOW

Key Points:

  • New home sales fell 11.3% in May from April to a seasonally adjusted 619K.
  • New home sales were 16.5% lower than May 2023.
  • The median sales price of new houses sold in May was $417,400 and the average sales price was $520,000.
  • The Right Facts will continue to monitor home sales.

MAY UNEMPLOYMENT RATE FELL IN 4 STATES, ROSE IN 3

Key Points:

  • Unemployment rates rose in three states, fell in four, and remained stable in 43 states and the District of Columbia in May.
  • The U.S. unemployment rate rose 0.1% to 4.0% in May but is 0.3% higher than last year.
  • In total, 24 states had unemployment rates lower than the U.S. figure of 4.0%, 4 states and the District had higher rates, and 22 states had rates that were not appreciably different from that of the nation.
  • Thirty-three states and the District had jobless rate increases from a year earlier, 2 states had decreases, and 15 states had little change.
  • North Dakota and South Dakota had the lowest jobless rates in May, 2.0% each.
  • The rates in Arizona (3.4%) and Tennessee (3.0%) set new series lows.
  • The District of Columbia had the highest unemployment rate, 5.3%, closely followed by California, 5.2%, and Nevada, 5.1%.
  • Four states had unemployment rate decreases in May: Arizona (-0.2%) and California, Maine, and Virginia (-0.1% each).
  • Three states had rate increases: Ohio (+0.2%) and Kansas and Massachusetts (+0.1% each).

HOME PRICES BREAK NEW RECORD

Key Points:

  • Existing-home sales fell 0.7% in May from April, to a seasonally adjusted annual rate of 4.11 million.
  • Existing-home sales fell 2.8% from one year ago.
  • The median existing-home sales price for May rose 5.8% from one year ago to $419,300 for the eleventh consecutive month of year-over-year price increases and the highest price ever recorded.
  • First-time buyers were responsible for 31% of sales in May, down from 33% in April but up from 28% in May 2023.
  • “Home prices reaching new highs are creating a wider divide between those owning properties and those who wish to be first-time buyers,” said NAR Chief Economist Lawrence Yun.
  • The Right Facts will continue to monitor home sales.

RETAIL SALES STAGNANT IN SIGN OF CONSUMER STRAIN

Key Points:

  • Retail sales, a measure of purchases at stores, restaurants and online, rose just 0.1% in May, below consensus of 0.2%.
  • March was revised down from 0.0% to -0.2%.
  • Excluding autos, retail sales fell by 0.1% over the month, the same reading as the April revisions.
  • Retail sales were 2.3% above May 2023 but CPI data released earlier this month showed prices have increased 3.3% in the last year.
  • Retail sales are not adjusted for inflation and reflect price differences as well as purchase amounts.
  • Total sales for the March 2024 through May 2024 period were up 2.9 percent (±0.5 percent) from the same period a year ago.
  • The Right Facts will continue to monitor retail sales.

REAL WAGES DOWN 2.2% UNDER BIDEN

Key Points:

  • Real average hourly earnings are hourly earnings adjusted for inflation. They are one measure of real wages, which represent the economic return to work.
  • Despite average hourly earnings trending up, wages are still down after adjusting for inflation.
  • The Consumer Price Index (CPI) was unchanged in May from April and is up 3.3% in the last year.
  • Real average hourly earnings have fallen from $35.71 in January 2021 to $34.91 in May 2024, a 2.2% decline.
  • Overall, prices have increased 19.3% since Biden took office in January 2021.