NAM: Manufacturing Salaries, Wages Rise 4.1 Percent In Q4
decreased 4.1 percent and 1.7 percent, respectively. More encouragingly, personal spending has jumped 13.3 per- cent over the past 12 months. With spending lower, the personal saving rate in- creased from 7.2 percent in November to 7.9 percent in December. The saving rate averaged 11.9 percent in 2021, down from 16.3 percent in 2020 but up from 7.6 percent in both 2018 and 2019. The PCE deflator rose 0.4 percent in December. Over- all, the PCE deflator has risen 5.8 percent year-over-year, the greatest increase since July 1982. Core inflation has increased 4.9 percent since December 2020, the fastest pace of inflation since September 1983. Core inflation is likely to remain elevated, even if the first half of 2022 brings some stabilization. The current forecast is for the core PCE deflator to be roughly 2.8 percent year-over- year by the end of 2022. For its part, the Federal Reserve will wind down its asset
Private manufacturing wages and salaries rose 1.0 per- cent in the fourth quarter, an increase that translates into 4.1 percent growth over the past 12 months, the fastest pace in the history of the data series, which dates to the beginning of 2001, according to Chad Moutray, Ph.D. and Chief Economist at the National Association of Manufac- turers (NAM). For all private-sector employees, wages and salaries increased 1.2 percent in the fourth quarter, with a record 5.0 percent growth year-over-year. Personal income rose 0.3 percent in December, with 7.3 percent growth over the past 12 months. At the same time, personal consumption expenditures fell 0.6 percent in December, declining for the first time since February. In December, spending on durable and nondurable goods
purchases, with quantitative easing ending in early March. The FOMC is also likely to increase short-term interest rates as soon as the March 15–16 meeting, with three or four rate hikes expected this year. Worries about inflation, as well as the spread of the omicron variant, dampened measures of consumer confidence, includ- ing those from both the Conference Board and the University of Michigan. In January, the latter index fell to the lowest point since November 2011. The U.S. economy jumped 6.9 percent at the annual rate in the fourth quarter. Real GDP growth was buoyed by very strong in- creases in spending on business invento- ries and services. The data also show neg- ative impacts from ongoing supply chain disruptions and the spread of the omicron virus, with weaker-than-desired spending on consumer goods and business invest- ment. Overall, the U.S. economy rebounded very strongly in 2021, with real GDP soaring 5.7 percent following the 3.4 percent de- cline seen in 2020. The current forecast for 2022 is for 4.3 percent growth. New orders for durable goods fell 0.9 percent from a record $270.1 billion in No- vember to $267.6 billion in December. Siz- able decreases occurred for aircraft and parts orders, which can be highly volatile from month to month. Excluding transporta- tion equipment, new durable goods orders increased 0.4 percent in December. New orders have jumped 12.7 percent over the past 12 months, or 11.9 percent with trans- portation equipment excluded. Visit www.nam.org for more information.
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