Weekly Economic Snapshot: 10/9 - 10/12

Economic Facts for This Week

• After adjusting for inflation, overall state funding for public two- and four-year colleges in the school year ending in 2018 was more than $7 billion below its 2008 level, threatening affordability, access, and quality of higher education for American students. 
• A growing body of research shows that Medicaid expansion has led to wider health coverage, better health outcomes, more financial security, more support for employment, and improved substance use treatment, among other benefits.
• Increases in the minimum wage reduce the likelihood of recidivism—the tendency for people to return to prison after release—for nonviolent crimes among both men and women. The availability of state Earned Income Tax Credits (EITCs) also has a similar impact, but only for women.
• A new online data visualization tool explores how upward mobility varies across neighborhoods in the United States and traces the roots of children’s outcomes in adulthood, such as earnings, poverty, and incarceration, back to the neighborhoods in which children grew up. 

Chart of the Week

New survey data shows that annual premiums for employer-sponsored health insurance rose 5 percent to $19,616 for family plans and 3 percent to $6,896 for single coverage in 2018, continuing the upward trend. The average covered worker is responsible for about 29 percent of the premium for family coverage and 18 percent of the premium for single coverage. And to add on to those costs, a growing share of covered workers face a general annual deductible. Since 2008, general annual deductibles for covered workers have increased more than eight times as fast as wages. This puts a strain on American families’ pocketbooks, as workers have to cover more and more of their health care bills out of pocket. 

Tracking Trump’s $4k Promise

During the tax debate, the White House claimed that the average American household would see an income increase of $4,000 a year because of the tax cuts. Below are some indicators looking at whether or not Republicans are living up to their promise:

• Stock buybacks are at record highs, with public companies announcing more than $750 billion in stock buybacks so far this year. Goldman Sachs projects buybacks could soar to $1 trillion by the end of 2018.
• Average weekly wages for production and nonsupervisory workers are just 2 percent higher than they were before the new tax law, before adjusting for inflation.
• The average hourly wage for production and nonsupervisory workers—our best measure of the median workers’ take home pay—was lower in August 2018 than it was in August 2017, after adjusting for inflation. 

 

ICYMI.

• New research from the Hamilton Project looks at how place-based policies—programs that target locations rather than individuals—could help narrow gaps in economic growth across the country.
• Local communities across the country are taking action to combat the opioid epidemic. In Nashua, New Hampshire, the Safe Stations program turns local fire stations into access points for anyone seeking help with an addiction to get connected with needed services.
• Younger adults experience higher unemployment rates than the overall population and participate in the labor force at declining rates in part due to increased higher education attendance.

 

Coming This Week

• Thursday 8:30am: Consumer Price Index (inflation, for September): https://www.bls.gov/cpi/news.htm
• Thursday 8:30am: Real Earnings (for September): https://www.bls.gov/news.release/realer.toc.htm
• Friday 8:30am: U.S. Import and Export Price Indexes (for September): https://www.bls.gov/news.release/ximpim.toc.htm