A Look At The Economy Midway Through 2013Play
This week marks the halfway point of the year. Where is the economy today?
This also is the 4th anniversary of the start of the "recovery." The GDP has been growing non-stop since late June or early July of 2009.
Have most people now completely recovered financially?
ROBIN YOUNG, HOST:
So, back in the States: This time, four years ago, the unemployment rate was shooting up, and would keep going until it peaked at 10 percent in October, 2009. But even though that was frightening, the economy was actually beginning to turn around at that time. Economists say the Great Recession actually ended in June of 2009, and the recovery began a month later.
So why does it still feel so lousy for so many Americans? Joining us to mark the recovery's fourth anniversary is Marilyn Geewax, senior business editor with NPR. Marilyn, do you have your little party hat on?
MARILYN GEEWAX, BYLINE: I do. I've got a little horn, too, a noisemaker to help celebrate - at the end, though.
YOUNG: But as you say, you know, party hat notwithstanding, it doesn't feel good for a lot of people. What's the problem?
GEEWAX: Any way that you measure this recovery that, as we say, has been going on for four years, it's been very weak. It's slow. We've averaged about 2 percent growth per year since the recovery began. And if you look at inflation, it's running at about maybe 2.3 percent over that time. So we're really just barely jogging in place, and that's pretty tough when you've had as big a drop as we had.
You have to remember in 2008, 2009, the economy really fell off of a cliff. We saw unemployment rates just shooting up. I was looking back at some data, and it's almost unbelievable. In the midsummer of 2007, the unemployment rate was about 4.6 percent. The next year, when the recession was getting going, it was up to about 5.5 percent. And by the midsummer of 2009, we were all the way up to 9.5 percent unemployment.
So that was just, like, running right up. And what have we had since then? Well, it's drifted down. We're down to about 7.5 percentish unemployment rate. But that's still really high. It's really painful. It's just been slow growth of the economy in general and particularly slow growth in jobs.
YOUNG: Well, and as you've said, we've always had a boom-and-bust economy. But this time, we really had the bust but not the boom. We have more of these, you know, inflation and increase canceling each other out. So what does that lack of a boom mean for most people?
GEEWAX: That's what we really wanted to see the housing prices, particularly, bounce back. And we've seen more of a bounce back somewhat in stock prices. They've kind of come back to where they were. But if you look at the housing data - and most people count on their home as being their primary asset when they reach retirement age. You really want that home equity to be there for you. And we saw home prices fall by about a third during the recession. And they've come back up.
Yes, we've had a good year too. We have seen prices bouncing back. But for most people in most places, the - you still really are under the levels that we saw even 10 years ago. And that hurts a lot, especially if you think about the great many baby boomers out there, a generation of maybe 78 million people and they're in their '50s, '60s. They really need to have their assets rising in value. And at best, you've seen very little bounce back in your total asset picture. People are getting back to where they were before, but they've lost all those years of increase.
YOUNG: Well, as you say, most economists looking for stronger growth in the second half of this year, more like three percent. We will, of course, be checking in with you along the way. But that's why it doesn't feel that great, even though we have party hats on, to have a recovery because it's been such a slow one. Marilyn Geewax, senior business editor at NPR. Marilyn, thank you as always.
GEEWAX: Oh, it's great to be with you.
YOUNG: Take a quick break. Back with a new way of looking at sports with a calculator in a minute, HERE AND NOW.
Transcript provided by NPR, Copyright NPR.
- Marilyn Geewax, senior business editor for NPR. She tweets @geewaxnpr.
This segment aired on July 3, 2013.