Americans Got Raise Last Year For First Time Since 2007

Americans Got Raise Last Year for First Time Since 2007

In a long-awaited sign that middle-class Americans are finally seeing real economic gains, U.S. households got a raise last year after seven years of stagnant incomes. Rising pay also lifted the poorest households, cutting poverty by the sharpest amount in nearly a half-century. 

Higher minimum wages in many states and tougher competition among businesses to fill jobs pushed up pay, while low inflation made those paychecks stretch further. The figures show that the growing economy is finally benefiting a greater share of American households... 

Still, median incomes remain 1.6 below the $57,423 reached in 2007. The median is the point where half of households fall below and half are above... 

Even so, it follows years of tepid pay gains that contributed to widespread political turmoil, driving insurgent presidential candidacies from GOP nominee Donald Trump and Sen. Bernie Sanders. Median household income remains 2.4 percent below the peak it reached in 1999.

Good news, but no need for policy-makers to get carried away. The Fed doesn't need to raise interest rates just yet. And, with income inequality still near record highs, there's plenty of room for much more wage-growth below the top 1 percent.