‘What A Six Months It’s Been’

Half A Year After Republicans Passed Tax Reform, Americans Are Keeping More Of Their Money, The Economy Is Taking Off, And Businesses Are Enthusiastic


SENATE MAJORITY LEADER MITCH McCONNELL (R-KY): “Today marks six months since the Tax Cuts and Jobs Act passed Congress. On Friday, it will be six months since the president signed it into law. What a six months it’s been. Already, Americans have seen their paychecks grow as the IRS withholds less of what they earn. Already, families are reaping the fruits of a new business tax code that gives American employers more ability to increase pay and create jobs. Six months in, these tax cuts have already led employers to issue ‘tax reform bonuses,’ raises, and new benefits to four million workers and counting. That’s welcome relief for middle-class families.” (Sen. McConnell, Remarks, 6/20/2018)


Tax Reform Delivers ‘Bigger Paychecks To Workers’

“[The tax reform law] is beginning to deliver a change that many will welcome — bigger paychecks. Workers are starting to see more take-home pay as employers implement the new withholding guidelines from the IRS, which dictate how much employers withhold from pay for federal taxes. Treasury Secretary Steven Mnuchin has estimated that the new rules will mean more take-home pay for about 90 percent of American workers.” (“Tax Bill Beginning To Deliver Bigger Paychecks To Workers,” The Associated Press, 2/01/2018)

  • “Those whose employers were quick to make the change welcomed the extra money — anywhere from a few dollars to a few hundred dollars. Wayne Love, who works in managed care in Spring Hill, Florida, got an extra $200 in his paycheck last week, which he said will help offset a $300 increase in the cost of his health insurance. ‘I have heard time and again that the middle class is getting crumbs, but I’ll take it!’ Love said by email…. And Todd Anderson of Texas and his fiance, who are both educators, got an extra $200 in their paychecks combined that they plan to use to cover the costs of a second baby on its way.” (“Tax Bill Beginning To Deliver Bigger Paychecks To Workers,” The Associated Press, 2/01/2018)

“Americans’ wallets fattened in January on recent tax cuts, indicating increased spending power may boost the economy this quarter. Real disposable income, or earnings adjusted for taxes and inflation, advanced 0.6 percent from the prior month, the biggest gain since April 2015, according to a Commerce Department report … The data, covering the first month since the tax law was signed in December, reflected a $30 billion increase in one-time bonuses and a $115.5 billion annualized drop in personal taxes, the Commerce Department said.” (“Real Disposable Incomes in U.S. Increase Most Since 2015,” Bloomberg News, 3/01/2018)

“‘Salubrious,’ ‘salutary’ and ‘healthy’ work as words to describe the 0.3 percent rise in average hourly earnings, which are up 2.7 percent over the last year — a nice improvement …” (“We Ran Out of Words to Describe How Good the Jobs Numbers Are,” The New York Times, 6/01/2018)


Over One Million Jobs Have Been Added Since Tax Reform Passed Six Months Ago

Since the Republican tax reform legislation passed in December 2017, more than one million jobs have been added to the workforce. (Bureau of Labor Statistics, “Employment, Hours, and Earnings from the Current Employment Statistics survey (National), 1-Month Net Change,” Accessed 6/05/2018)

“The jobless rate ticked down to 3.8% in May, another sign of the strong economy and tight labor market. That tied the lowest unemployment rate since 1969. Since then, the only other time unemployment was this low was in April 2000…. The jobs report painted a picture of an economy with opportunities for almost everyone. Black unemployment fell to a record low, and the gap between black and white unemployment shrank to the narrowest ever measured. Job openings are at a record high, and businesses are hungry for workers.” (“Unemployment Rate Matches Lowest Point In Half A Century,” CNN Money, 6/01/2018)

“The U.S. had more job openings this spring than unemployed Americans. For the first time since such record-keeping began in 2000, the number of available positions exceeded the number Americans without jobs and actively looking, the Labor Department said Tuesday.” (“American Jobs Outnumber the Jobless,” The Wall Street Journal, 6/05/2018)

“Sixty-seven percent of Americans believe that now is a good time to find a quality job in the U.S., the highest percentage in 17 years of Gallup polling. Optimism about the availability of good jobs has grown by 25 percentage points since Donald Trump was elected president.” (“Optimism About Availability of Good Jobs Hits New Heights,” Gallup, 5/21/2018)


American Job Creators Are Optimistic About The Economy And Expanding

“In the latest Manufacturers’ Outlook Survey from the National Association of Manufacturers (NAM), it is clear that businesses continue to experience highly elevated levels of activity as a result of pro-growth policies like tax reform, with optimism once again breaking records—95.1 percent of respondents were either somewhat or very positive about their own company’s outlook, the highest rate since the 20-year-old survey was introduced …” (“NAM Manufacturers’ Outlook Survey Second Quarter 2018,” National Association of Manufacturers, 6/20/2018)

“The Small Business Optimism Index increased in May to the second highest level in the NFIB survey’s 45-year history…. ‘Main Street optimism is on a stratospheric trajectory thanks to recent tax cuts and regulatory changes. For years, owners have continuously signaled that when taxes and regulations ease, earnings and employee compensation increase,’ said NFIB President and CEO Juanita Duggan.” (“Small Business Optimism Index Soars, Continuing Historic Run, Hitting Several Records in May,” NFIB Website, 5/2018)

  • “The May report hit several records:

“U.S. companies are ramping up spending on their businesses at the fastest pace in years, a long-awaited development after years of tepid growth. Spending on factories, equipment and other capital goods by companies in the S&P 500 is expected to have risen to $166 billion in the first quarter, up 24% from a year earlier, according to Credit Suisse data going back to 1995. It is on track for the fastest pickup since 2011 and a record for the first quarter of a year. The jump has been aided by the U.S. tax-code overhaul, which is putting more cash in companies’ coffers.” (“Capital Spending Boom Is No Great Boost to Capital Markets,” The Wall Street Journal, 5/15/2018)



Related Issues: Small Business, Tax Reform, Economy, Taxes