Thread: The recession is over, economists say, but the pain isn't

The recession is over, economists say, but the pain isn't

The National Bureau of Economic Research declares that the turning point came in June 2009, making it the longest downturn since World War II. But, the group notes, the economy still hasn't returned to vigorous growth.

More than 8 million lost their jobs in the longest economic downturn since the Great Depression. The damage done in the 18 months of recession may take years to fix. (Associated Press)

By Don Lee, Los Angeles Times
September 20, 2010|10:21 a.m.

Reporting from Washington — The panel of economists that dates the nation's economic cycles declared Monday that the recession that started in December 2007 ended in June of last year -- making it the longest downturn since World War II.

The National Bureau of Economic Research, a private nonprofit research group that is considered the official arbiter of economic contractions and expansions, took pains to note that a determination of the end of the recession doesn't mean the economy has returned to vigorous growth.

"The committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity," the panel said in a statement after meeting Sunday.

With the housing market still depressed, and the official unemployment rate near 10% and jobs growing very slowly, many economists are concerned about the possibility of the economy lapsing into another recession.

In setting June 2009 as the beginning of expansion, any future economic downturn would mark a new recession and not a continuation of the one that began in late 2007.

Many analysts have been expecting the NBER committee to set the recession's end in the summer of 2009. The NBER usually dates beginnings and ends of recessions about 12 months after the fact, but the panel waited a little longer this time for more complete economic data.

The NBER committee, which is made up of eight academic economists, said it made its determination based on the length and strength of the recovery to date.

It noted that the nation's gross domestic product, a broad measure of economic activity, reached its low point in the second quarter of 2009. And strong growth in GDP, as well as a broad income measure, in the fourth quarter last year ruled out the possibility that the bottom occurred later than the third quarter last year, the panel said.

The committee also considers a variety of other data, including monthly indicators of jobs and unemployment -- statistics that may be most important for many in the public and that have led some people to question whether the nation has really emerged from recession.

But as the NBER panel pointed out, employment measures are typically lagging indicators.

The December 2007-to-June 2009 recession is two months longer than the two previous longest postwar recessions, in 1973-75 and 1981-82. Between 1945 and 2001, there have been 10 recessions that on average lasted 10 months, according to the NBER.

don.lee@latimes.com

http://www.latimes.com/business/la-fi-r ... 8295.story

With the housing market still depressed, and the official unemployment rate near 10% and jobs growing very slowly, many economists are concerned about the possibility of the economy lapsing into another recession.

BUT THE RECESSION IS OVER!

EVIDENTALLY NOT FOR A LOT OF PEOPLE OUT THERE