Augustine (Gus) Faucher es vicepresidente sénior y economista en jefe de The PNC Financial Services Group, y se desempeña como portavoz principal en todos los asuntos económicos de PNC.
Antes de unirse a PNC en diciembre de 2011 como especialista sénior en macroeconomía, Faucher trabajó durante 10 años en Moody’s Analytics (anteriormente Economy.com), donde fue director y economista sénior. Fue responsable de dirigir el modelo informático de la economía estadounidense de la firma, editaba una publicación mensual sobre las perspectivas económicas de los EE. UU., cubría la política fiscal y monetaria, y analizaba varias economías regionales. Anteriormente, trabajó durante seis años en el Departamento del Tesoro de los EE. UU., y enseñó en la Universidad de Illinois en Urbana-Champaign. Fue nombrado vicepresidente sénior en marzo de 2015, economista principal adjunto en febrero de 2016, y a su función actual en abril de 2017. Faucher es citado con frecuencia en los medios de comunicación internacionales, nacionales y regionales, The Wall Street Journal y The New York Times. Se ha presentado en ABC World News, CBS Evening News, NBC Nightly News y Nightly Business Report, y se presenta regularmente en CNBC, CNN y Fox Business. Además, se presenta regularmente en CBS Radio, NPR y Marketplace.
Transcripción del webcast:
Speaker: Hi, I am Gus Faucher, Chief Economist for the PNC Financial Services Group. With an economic outlook for the first quarter of 2026. The US economy continues to grow strongly heading into 2026. Since the pandemic, the US economy has grown by about 15% adjusting for prices. That's by far the best economic performance among G7 Nations.
In second places Canada, around 11%. The Eurozone economy has only grown about 6% during this time, and the German economy has barely grown since the pandemic. So we are experiencing much stronger economic growth in other developed economies since the pandemic, and that strong economic growth has continued throughout 2025 and into 2026.
However, the job market has slowed significantly over the past couple of years. Employment as measured by a survey of employers, has been slowing from above 200,000 per month in 2023 to around 160,000 per month in 2024 to about 30,000 to 40,000 per month in 2025. So much weaker job growth. Some of this is coming from reduced demand for labor, but some of it is also coming from a reduced supply of labor with reduced immigrant flows and increased deportations.
The size of the US Labor force is growing more slowly, and so that is making it difficult to recruit workers, but businesses are also being more cautious with their hiring. The unemployment rate, which got down to 3.4% briefly in 2023. The lowest unemployment rate we've had in more than 50 years has increased somewhat over the past couple of years.
It was 4.4% at the end of 2025. Still historically low, but an indicator that there is more slack in the job market than there was a couple of years ago. And people who are coming into the workforce after graduating from school or having a child are finding it more difficult to find a job. One of the factors supporting the economy in 2025 has been strong growth in consumer spending.
The orange line is consumer spending adjusted for changes in prices. So this measures volumes, not price changes. What you can see is, is that for the past few years, consumer spending has been growing about two to 3% per year, adjusted for inflation. However, income growth has seen a very different story.
When the job market was very strong in 2023 when the economy was adding hundreds of thousands of jobs per month and wages, wage growth was very strong. Personal income was growing about 7% year over year after adjusting for inflation. But as job growth has slowed and as wage growth has slowed, we've seen after-tax personal income growth slowed to around 1% by the end of 2025.
What this means is, is that for the past year and a half is that spending has been growing more quickly than incomes. In some respects, households have been funding this by drawing down on their savings. And high income households have been spending out of their increased stock returns and increased returns on their homes.
But that process cannot continue indefinitely. We cannot continue to have spending growing more quickly than incomes. So we do expect the consumer spending growth will slow substantially in 2026. Given that consumer spending makes up about two thirds of the US economy, that means weaker economic growth this year compared to the last couple of years. And in particular, we're seeing more stress among lower and lower middle income households. This chart shows data from the Federal Reserve Bank of Atlanta. It shows income, uh, wage growth, excuse me, by wage quartile. That is the blue line represents the bottom 25% of wage earners in the United States.
What you can see is, is that during the very strong labor market, recovery from the Great Recession, and then in the early stages of the recovery from the pandemic, so roughly from 2015 through 2022, these lowest wage earners saw the strongest wage growth. However, more recently as a job market has slowed, this group has seen a substantial slowdown in wage growth, and it is now running well below the average for other wage earners.
This means that lower, lower middle income households are under more financial stress in 2024, 2025, heading into 2026 compared to other groups in the economy, and that's this will weigh on their spending growth going forward. Other households, particularly high income households continue to benefit from a bit stronger wage growth, so they should be better able to keep their spending going forward in 2026.
One factor that has been a big positive for economic growth over the past couple of years is investment in technology. Looking at things like investment in data centers, in software, in computer hardware, information technology, processing equipment and so forth. That has grown much more quickly than the overall economy.
You can see that tech investment is a share of GDP has jumped by about a half of a percentage point just over the past couple of years. This is very good news for the US economy. A lot of investment in tech, in AI means that economic growth is solid. However, this does make the US economy vulnerable to a downturn in tech, in tech investment. If we were to see businesses turn more cautious with their tech investing, then that would be a drag on economic growth. In addition, a lot of the stock market gains have been coming from tech companies that have done very well during the AI boom. So if we were to see a slowdown in technology investment, and if we were to see expectations for the returns on that investment fall, we might see a pullback on the stock market that would weigh on high income households especially. Now, I'm not saying this is gonna happen.
Given the strength of tech investment over the past couple of years, this is a possible story and something to watch out for. But putting it all together with continued improvement in job growth, even if it is slower than it was a couple of years ago, continued wage growth, A bit of in slow, slowing in inflation in 2026, and then we expect to see the Federal reserve cut interest rates in the second half of 2026.
We expect to see a bit weaker economic growth this year, but certainly not a recession. And then as those fed rate cuts work their way through the economy, we expect to see a pickup in economic growth in 2027. Similarly, the unemployment rate 4.4% at the end of 2025. It ends 2026, right around the same place.
It's a good unemployment rate, historically low. Not as good as it was a couple of years ago, but still solid, and then perhaps a slight decline in the unemployment rate in 2027. You can see all of our materials at pnc.com/economicreports. You can follow me on X, formerly Twitter @GusFaucerPNC, and thank you very much for your time.
