U.S. Wage Growth Indicates Slow Turnaround May be Underway

Posted Dec 23rd 2009 12:00PM by Mark Fightmaster
Filed under: Before the Bell, Good news, Economic Data

This morning, the Commerce Department announced that compensation earned by U.S. workers rose 0.3% in November -- the best increase since April.

The higher wages helped elevate total personal incomes by 0.4% last month -- the largest gain since May and inline with economists' expectations. Taking inflation out of the equation, after-tax disposable incomes increased 0.2%, while inflation-adjusted real spending increased 0.2%.

Some believe that this data is a sign the economy is improving, mainly because labor markets are starting to come around. I truly hope that we are in the midst of a turnaround, but I don't want to wave the flag of victory yet. I hope this data can carry over to December data, including retail sales. If the Christmas/Holiday shopping season is strong, we could see the market further continue its ascension.

I don't want to sound like Chicken Little here, but I don't want to get too excited over data that indicates a slow turnaround. Unfortunately, this data could turn on a dime and the frazzled nerves of investors could do the same. So while this is good news, let's make sure this growth will carry over into the next year before getting too excited.

Tags: economic data, economic recovery, economic turnaround, income, inthenews, jobs