August 14, 2005

About that economic 'recovery' in the U.S.

It sucks, says yet another US government agency — in this case, the Federal Reserve Bank of New York. In a new report [PDF file], the NY Fed says that the current recovery is the worst in recent US history in terms of creating jobs.

Employment growth has been much slower than it has been in all post–World War II recoveries — including the 1990s recovery, when employment also took an extraordinarily long time to rebound. Typically, employment growth lags business cycle recoveries by three to four months. In the 1990s recovery, the lag was a little more than two years. In the current recovery, the lag is three to four years and, at the time of our writing, the labor market has not yet clearly recovered. [...]

The poor recovery in the labor market goes beyond sluggish job growth. While the rate of unemployment has been moderate, the duration of joblessness has been high three years into the recovery, and an exceptional proportion of persons not participating in the labor market want to work. In addition... a large share of jobs created in the recovery were temporary. Almost 30 percent of new jobs created from November 2001 to December 2004 were in the temporary-help services sector. During the 1990s recovery, only 10 percent of new jobs were in temporary-help services.

None of this information is new, particularly, but it bears repeating given the neverending rosy economic pronouncements from the Oval Office. What is especially important about this new report, as Hale Stewart points out at BOPNews, is that this is the third government report in the past few months to give the economy a failing grade. [The other reports came from the Federal Reserve Bank of Boston and the Congressional Budget Office.]

As the NY Fed points out elsewhere in its report, these bad economic numbers aren't just of academic interest: the ramifications of the sluggish economy can be grim for US workers:

The United States has only a limited safety net for workers. Those who lose their jobs risk losing health care or seeing their family drop from the middle class into poverty.

Of course, none of this seems to matter to Dubya and the other happy-talkers in his administration.

Via BOPNews.

Posted by Magpie at August 14, 2005 11:09 AM | Economy | Technorati links |

There is no economic recovery in America at this time. There are however manufactured numbers and statistics being released all the time, the sole purpose of which is to move the markets on the day of release then drop down the memory hole straight afterwards. interest rates are being raised into a failing economy for no other reason than to protect the dollar from a selloff by global investors. this is the end product of profligate spending and providing tax cuts to ones rich friends. And as usual those who pay the penalty will be the working poor, the unemployed, the sick and the other words the most powerless. Why does your hopelessly corrupt President still draw so much apparent support form the very people his "policies" hurt the most??

Posted by: Paul at August 14, 2005 04:13 PM