President Donald Trump recently dubbed U.S. economic performance under his tenure the “blue-collar boom,” citing a low unemployment rate and strong wage growth. In a newly released interview, former Commerce Secretary Penny Pritzker disputed the characterization, saying major problems like wealth inequality still plague the economy.
“He painted a very rosy picture,” Pritzker told Yahoo Finance Editor-in-Chief Andy Serwer at the World Economic Forum in Davos, Switzerland last month. “But I think there's still a lot of challenges that aren't being dealt with.”
“We have a real problem with inequality in our country, and unequal opportunity, things that need to be dealt with,” adds Pritzker, a major Democratic donor who endorsed former Vice President Joe Biden’s presidential candidacy earlier this month. “We've got a manufacturing recession going on. And we don't really have the capital investment that we need.”
On Thursday, data released by the Commerce Department showed U.S. gross domestic product grew at a rate of 2.1% over the last three months of 2019, resulting in slower average GDP growth last year than in 2017 or 2018. Trump had promised annual GDP growth of at least 3%, but blamed Federal Reserve policy, a strike at General Motors (GM), and struggles at Boeing (BA) for the figure.
Nevertheless, the economic expansion has persisted under his tenure, making it the longest in U.S. history. The benefits of that growth have begun to spread to low-wage workers, whose pay is growing faster than those at the top for the first time in at least 20 years; however, median household wealth remains below pre-recession levels.
Pritzker acknowledged rising wages but said Trump has overstated the broad-based distribution of recent gains.
“It's an election year, and he's painting a picture that's positive, which is good, you know, unemployment is low, and wages are rising, but not for everybody,” she adds. “How do we deal with inclusive prosperity, and how do we create opportunity for everyone?”
Pritzker, a billionaire heir to the Hyatt Hotel fortune and sister of Illinois Governor J.B. Pritzker, made the comments during a conversation that aired in an episode of Yahoo Finance’s “Influencers with Andy Serwer,” a weekly interview series with leaders in business, politics, and entertainment.
After serving as national finance chair for Barack Obama’s 2008 presidential campaign, she took a seat on Obama’s Council on Jobs and Competitiveness and his Economic Recovery Advisory Board. From 2013 to 2017, she held the position of Secretary of Commerce. Currently, she sits on the Microsoft (MSFT) board and is chairman of PSP Partners, a private investment firm.
One reason for ongoing wealth inequality, Pritzker said, is a lack of qualified applicants for available positions.
“Our companies really have a challenge to get enough skilled labor, and there's a lot of vacant jobs,” she says.
“What we're trying to do is get our universities, our community colleges, and our high schools to all work together, so that we're creating a pipeline, an easy path for our young people to follow to be qualified for those open jobs,” she adds.
She said the problem is especially acute in jobs that require tech skills.
“Whether you're Allstate (ALL), or you're McDonald's (MCD), or you're a startup technology company, we just have a ton of open technology jobs,” she says. “So we need to make it easier for a young person to get themselves prepared for those opportunities.”
Max Zahn is a reporter for Yahoo Finance. Find him on twitter @MaxZahn_.