Life in the Obama Economy: Weakest Recovery in Decades
By: Nicole Kaeding
According to the National Bureau of Economic Research (NBER), the official economic arbiter in the United States, the recession ended three years ago in June 2009. Most Americans would disagree. They see signs of a weak economy all round—from record-high unemployment rate, pain at the gas pump and concerns about making ends meet. Now we know why. Yesterday, the Associated Press (AP) released a startling report that shows just how bad the American economy is doing. This is the weakest economic recovery since World War II. This is not a distinction we should be proud of.
In previous posts in this series, we’ve highlighted how people are struggling to find work. Millions of Americans are still looking for a job, and hundreds of thousands have simply giving up looking for one altogether. Half of all recent college graduates are unemployed or underemployed. With the most recent jobs report, the unemployment rate has been over 8% for 42 months.
It certainly doesn’t feel like recovery. The AP report shows just how abnormal this so-called recovery is.
Individuals who have been unemployed for greater than 27 weeks is over 40% of the labor force—twice as high as previous recoveries. By this point in the Reagan Recovery, the period following the 198-82 recession, the economy had created almost 10 million jobs, replacing the 2.8 million jobs lost and adding 7 million more. Even with the 163,000 jobs created in July, net job creation is still negative during the recovery under President Obama’s leadership. Job creation for the first half of 2012 was barely fast enough to keep up with demographic changes. Forget trying to close the unemployment gap.
Looking further than job creation, the economy as a whole is on life-support. The economy’s growth was below 2% for the first half of the year—well below the 3.3% U.S. average growth rate. Since the end of the recession, the economy grew by only 6.8% or the slowest in any post-war recession. The average growth of the other eight recessions was 2.5 times bigger. And this isn’t predicted to get any better. The Federal Reserve predicts this anemic growth will continue well into 2014.
Finally, families’ take-home pay is stagnating, making the economic pain even worse. Paychecks are growing slower than prices are rising. The cost of groceries is up 7% under the President’s leadership. Gasoline prices have doubled. Since the end of the recession, earnings are only up by 6%, hamstringing more and more family budgets.
The President’s $700 billion stimulus boondoggle hasn’t worked. His $1.68 trillion health care law hasn’t worked. Adding thousands of pages in regulation hasn’t worked. Americans knew it all along, but now we have the facts. These policies will not grow the economy, nor will they put hard-working Americans back to work.
The weakest recovery in post-war history is not something to be proud of.