Is Trump delivering on promise to help workers?

President Donald Trump is expected to paint a glowing picture of the U.S. economy on Tuesday night when he gives his third State of the Union address. Missing from that scene, however, is clear evidence he is delivering on one of his administration’s central promises — to boost the economic fortunes of millions of working-class Americans.

Manufacturers, after booming in 2018, narrowly avoided a recession last year, wounded by Mr. Trump’s trade fights with China and other countries. Jobs in the sector — long the bulwark of a middle-class lifestyle — now pay less than the average job in the U.S.

And while the nation’s ultra-low jobless rate under Mr. Trump means higher incomes for the lowest-paid workers, many economists note the increase owes as much to moves by numerous states around to country to hike their minimum wages than any policy out of Washington, D.C..

About that manufacturing slump

President Trump likes to tout America’s “blue-collar boom,” which he recently called “beyond anybody’s expectation.” During his inaugural address in 2017, he also said that “Every decision on trade, on taxes, on immigration, on foreign affairs will be made to benefit American workers and American families.”

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Blue-collar jobs did see a boom — in 2018. Last year, manufacturing jobs barely grew as factories hunkered down in the midst of the trade wars. Since Mr. Trump entered office in 2017, the number of manufacturing jobs has expanded more slowly than the broader labor market. The result: Manufacturers today account for a slightly smaller share of employment than they did in 2016.

Those jobs are also paying less. A decade ago, the average manufacturing job paid $1 an hour more than jobs overall. Today, those same jobs tend to pays less that most other kinds of work, according to figures from the Bureau of Labor Statistics.

According to the liberal Center for Economic and Policy Research, that’s at least in part due to which parts of the country have seen the most economic growth. Factory jobs have disappeared from Midwestern states like Michigan, Pennsylvania, Ohio and Wisconsin, while growing in southern and western states, where those jobs usually pay less.

Pay hikes — thanks largely to individual U.S. states

Average pay around the U.S. is rising faster today than when President Trump took office three years ago, though it is slower than its peak in February 2019, when hourly earnings grew 3.4% on a year-over-year basis.

For lower-wage workers, the good news is they are capturing much of those gains after decades of muted wage growth. Since 2015, the lowest-paid quarter of workers has seen a higher percentage increase in pay than the top 25%, according to the Federal Reserve Bank of Atlanta.

Some research has found that this increase is partly driven by states increasing their minimum wages. States that raised their minimum wage between 2013 and 2018 saw pay for their lowest-paid workers grow more than 50% faster than those that didn’t, according to an analysis from the left-leaning Economic Policy Institute. The trend continued in 2019, said Elise Gould, senior economist at EPI.

“Year after year, we’ve seen states increase their minimum wage, either through indexing [for inflation] or legislation, and we have seen faster wage growth at the bottom in those states that have increased their minimum,” she said.

Nearly half of U.S. states and many cities are boosting their minimum wage this year. Meanwhile, the federal minimum wage has remained at $7.25 since 2009 — the longest stretch without a hike in baseline pay. The House of Representatives in July voted to raise the minimum wage to $15, but the bill has stalled in the Senate, and Mr. Trump has not addressed the issue.

How’s your 401(k)?

The president likes to point to the stock market as a sign of the economy’s health. He has done well on that account, presiding over a 43% increase in the S&P 500-stock index in the three years since his inauguration — better than George W. Bush for a similar period, but behind the blue-chip stock index’s performance under both Bill Clinton and Barack Obama. 

Trump’s State of the Union will hold a unique place in history

Still, a hot stock market doesn’t mean all workers are doing better. Richer Americans hold a far greater portion of the nation’s wealth, with the top 10% of income earners owning nearly 85% of the value of all stocks.

“People who own shares have definitely done well, but most middle-class workers, they can’t afford to put away an appreciable amount for their retirement,” said Paul Sonn, director of the National Employment Law Project Action Fund. 

“Slow and steady”

Despite the modest economic growth, the longest expansion in U.S. history, which started in 2009, shows few signs of winding down 11 years later. Perhaps even more important, data suggest a broader swath of Americans are benefiting: More people have come off the sidelines and found jobs. As a result, the proportion of Americans in their prime working years (ages 25 through 54) who are employed is now higher than before the Great Recession.

Another boon is that the moderate growth has meant that, at least so far, the economy isn’t showing evident signs of excess akin to the housing bubble that led to the 2008 financial meltdown.

“This expansion has been slow and steady, but it could run for a few more years,” Ryan Sweet, an economist at Moody’s Analytics, told the Associated Press. “There’s no reason that it needs to die. Sometimes slow and steady does win the race.”

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