As the nation enters election season, the question of whether households are better off now than they were four years ago is at the forefront. Comparing the economic landscape of March 2024 to that of March 2020, marked by the onset of a global pandemic, the answer is a resounding yes. Even when comparing the recent winter months of 2024 to the pre-pandemic period, the data reveals a robust and stable economy that has significantly improved the material well-being of American families.
Job Stability Is More Pronounced Than Before The Pandemic
The labor market has witnessed a swift recovery, attributed to substantial fiscal policy interventions. Unemployment rates have plummeted as jobs returned at a rapid pace. Notably, the current unemployment rate of 3.8% is on par with the 3.6% average before the pandemic. Moreover, indicators such as job openings and layoff rates suggest that workers now enjoy a more favorable labor market compared to the period preceding the pandemic.
More Workers Receive Substantial Wage Gains
The enhanced job stability has translated into widespread wage increases. Data indicates that average hourly wages in February 2024 were one percent higher than four years prior. Furthermore, a larger proportion of workers are now experiencing wage growth above the inflation rate, particularly benefiting younger workers.
Household Wealth Far Outpaces Income
Household wealth has surged, with total wealth reaching $156 trillion by the end of 2023, significantly outpacing average after-tax income. Notably, wealth gains have been most pronounced among younger households and Millennials, setting the stage for improved economic security and mobility.
Homeownership Has Expanded
The rise in homeownership rates has been a key driver of wealth accumulation. The U.S. homeownership rate climbed to 65.7% by the end of 2023, with notable increases among younger households and those with lower incomes, reflecting a more equitable economic recovery.
Households Face Lower Debt Burdens
Despite debt being a common feature of American households, the overall debt burden has decreased in recent years. The data shows a gradual deleveraging trend, with outstanding loans relative to after-tax income declining, enabling households to reduce their debt burdens amidst a backdrop of strong income growth and economic stability.
