Economy
June 15, 2013
Is the recovery here to stay?

The U.S. economy is slowly climbing out of the worst downturn since the Great Depression, but unemployment, though falling, remains high, especially among minorities. Meanwhile, some key U.S. trading partners, notably troubled countries in the eurozone, are still in recession. Congress and the White House are deadlocked over how best to spur domestic economic growth, and the Federal Reserve continues to pump money into the economy to help it recover. Conservatives are pushing for tax cuts to spur job growth and austerity measures to reduce the federal deficit, while liberals advocate additional government spending on infrastructure and other projects to boost growth. Even as unemployment remains high, corporate profits and stock-market performance have largely recovered from the declines of a few years ago, adding to concern about widening income inequality in American society.

A trader at the New York Stock Exchange reacts on March 5, 2013, to the surging Dow Jones Industrial Average. The market hit record highs this spring, marking a milestone in its recovery from a steep decline during the recent recession. (AFP/Getty Images/Emmanuel Dunand)   A trader at the New York Stock Exchange reacts on March 5, 2013, to the surging Dow Jones Industrial Average. The market hit record highs this spring, marking a milestone in its recovery from a steep decline during the recent recession. (AFP/Getty Images/Emmanuel Dunand)

After the worst economic downturn since the Great Depression, the U.S. economy is showing uneven signs of recovery. Unemployment has fallen slowly, and economic growth and job creation remain weak. And while the stock market set new highs this year, median household income — which plunged during the recession — remained about 7 percent lower in early 2013 than five years earlier. 1

After contracting between late 2007 and June 2009, the economy grew by an average of 2.1 percent per year between 2010 and 2012 — slower than the 3.2 percent average from 1997 to 2007. 2 Meanwhile the most recent unemployment rate of 7.6 percent in May 2013 — while an improvement over a peak of 10 percent in October 2009 — was still well above the 4.7 percent level in the month before the recession began. 3

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