WEAK RECOVERY

“Nonfarm payroll employment was unchanged (0) in August, and the unemployment rate held at 9.1 percent.” (U.S. Bureau of Labor Statistics)

(September 2, 2011) Today’s monthly BLS report noting zero employment growth last month provides further evidence that the economy remains mired in a weak recovery.

Three key economic indicators (GDP, payroll employment, industrial production) underscore the weak recovery evident since the recession formally ended in June 2009.¹ These indicators have not recovered to their pre-recession (4Q-2007) levels more than two years into a new expansion.

Gross Domestic Product has expanded for eight consecutive quarters since 2Q-2009 but remains less than its pre-recession level.

Payroll employment is higher (131,132,000 in August 2011) than at the end of the recession (130,493,000), expanding in 10 of the last 12 months. The growth, however, has been so weak that it has not significantly reduced the national unemployment rate (9.1%), and employment is less than its pre-recession level (137,899,000 in November 2007).

Industrial production is also higher than at the end of the recession but lower than its pre-recession level. The indicator measures the output of the nation's factories, mines and utilities.

--Greg Kaza

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¹ The following Policy Foundation research memos have noted the weak economic recovery: “Few Employment Sectors Growing” (July 15, 2011); “Manufacturing Losses Lead to Weakest Postwar Employment Growth” (July 2011); and “NBER Confirms Policy Foundation Finding Recession Ended In 2009” (Sept. 20, 2010).

Sources: U.S. Bureau of Economic Analysis, U.S. Bureau of Labor Statistics, Federal Reserve System.