15 Months Out of Recession, but Not Feeling Like It
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This is the VOA Special English Economics Report.
Businesses are still slow to hire and unemployment remains near ten percent. But an economic research group reported this week that the recession in the United States ended in June of last year.
It was the longest since the nineteen thirties.
James Stock is on the committee that dates the rises and falls of the business cycle for the National Bureau of Economic Research. The Harvard professor says this recession was in some ways a lot like others since World War Two.
JAMES STOCK: "I think what I’ve been struck by is how these numbers basically look like all the other recessions we've had in the postwar period."
But one difference was the length -- eighteen months. Many recessions since the nineteen forties lasted less than a year.
Another difference was the severity. The economy shrank by more than four percent. About eight million people lost their jobs.
Professor Stock thinks job growth is likely to increase in the coming months based on current levels of productivity.
JAMES STOCK: "I think that we are at a point right now where productivity has increased so much that for output to continue to grow, we will be seeing increases in hiring."
Some economic signs have improved. Manufacturing, industrial production and consumer spending have made small gains. But a Labor Department report shows that new claims for unemployment insurance rose unexpectedly last week.
On Monday, President Obama took questions at a meeting shown on CNBC television. One questioner wondered if today's young Americans still could hope for a good life.
QUESTIONER: "What I'm really hoping to hear from you is several concrete steps that you're going to take moving forward that will be able to re-ignite my generation, re-ignite the youth who are beset by student loans. And I really want to know, is the American Dream dead for me?"
BARRACK OBAMA: "Absolutely not. Look, we still have the best universities in the world. We’ve got the most dynamic private sector in the world. We've got the most productive workers in the world. There is not a country in the world that would not want to change places with us."
But the economy could change the balance of power in Congress in the November elections.
Critics say the president's economic stimulus programs have only put the country deeper in debt. Economists disagree about the extent to which the spending has helped. But many agree that the president's policies avoided a worse situation.
Or, as Mr. Obama put it at the United Nations on Thursday: "The global economy has been pulled back from the brink of a depression."
In Washington, central bank policy makers said inflation remains low. In fact, they said it may be too low to support their aims for price and wage stability.
And, Lawrence Summers, director of the president's National Economic Council, said he will leave at the end of the year to return to Harvard University.
And that's the VOA Special English Economics Report, written by Mario Ritter. I’m Steve Ember.