Wage gains for low earners have helped sustain America’s economic expansion

AT 128 MONTHS and counting, America’s economic expansion is the longest on record. Longevity has not come easily. The expansion trundled along despite global manufacturing downturns in 2016 and 2019, conflicts over trade, and a bout of monetary tightening by the Federal Reserve. The recovery ploughed ahead last year even as business investment decelerated and residential-construction investment shrank, thanks to rock-steady growth in personal consumption. The durability of spending is a testament to one of this expansion’s more unusual features: faster growth in wages for workers at the bottom of the income distribution than for high earners. Improved fortunes for low-wage workers may, it seems, be an underappreciated contributor to the sustainability of economic booms.