, Columnist
Wage Growth Isn't Threatening Corporate Profits Yet
The pressure hasn’t reached a critical level.
No alarm just yet.
Photographer: John Moore/Getty Images
This article is for subscribers only.
The jobs report on Friday brought a little good news for investors worried that a key part of the decade-long bull market is about to run out.
Profit margins, which have reached record levels, are predicted to drop in the first quarter for companies in the S&P 500. While the drop is not expected to be sharp, there has been a growing concern that it could deprive the stock market of a vital ingredient. If profit margins were the same as they were in 2012, for instance, the S&P’s earnings would have been $120 a share in 2018 instead of $158.