WASHINGTON: From household wealth to spending at stores, many of the economy’s vital signs have recovered from the damage done by the Great Recession.
Home foreclosures and layoffs have dropped to pre-recession levels. Economic output has rebounded. And the Dow Jones industrial average is in record territory.
So is the economy back to full health? Not quite.
Not with unemployment at 7.6 percent and with 3 million fewer jobs than when the recession began. And while the housing market is improving, that engine of economic growth and job creation still has far to go before it can be declared healthy.
The recession officially began in December 2007. It ended in June 2009. Here’s a look at ways in which the economy has returned to pre-recession levels and ways it hasn’t:
What’s back
• Household wealth: Americans lost $16 trillion in wealth during the recession, mainly because home values and stock prices sank. Those losses have now been reversed. Household “net worth” reached $66.1 trillion in the final three months of 2012, according to the Federal Reserve. That was just 2 percent below the peak reached in the fall of 2007.
• Retail sales: They totaled $421.4 billion in February. Adjusted for inflation, that was nearly 18 percent above the recession low and just 0.7 percent below the record level in November 2007.
• Layoffs: They soared from 1.8 million in December 2007 to 2.6 million in January 2009. In January this year, employers cut 1.5 million jobs — the lowest monthly total in the 12 years the government has tracked such data.
• Foreclosures: Foreclosures have sunk back to pre-recession levels. Banks repossessed 45,000 homes in February 2013, according to RealtyTrac, a foreclosure listing firm. That was the fewest since September 2007 and was down from a peak of 102,000 in March 2010.
• Stock market: Last month, the stock market finally regained the painful losses investors suffered during the recession.
• GDP: America’s economy is producing more goods and services than before the recession began. In the final three months of 2007, it produced an annual rate of $13.3 trillion in goods and services, a record high. That figure had shrunk to $12.7 trillion when the recession ended. It then began to recover. The U.S. gross domestic product, the broadest gauge of production, regained its previous peak by the end of 2011. And in the final three months of 2012, GDP was $13.7 trillion. Still, that gain comes with an asterisk, because the population has grown. Viewed on a per capita basis, GDP at the end of 2012 remained 1.5 percent below its pre-recession peak.
What’s not back
• Total jobs: The United States still has far fewer jobs than in December 2007. The recession eliminated 8.7 million. Since then, 5.7 million jobs have come back, leaving the economy 3 million short. And the population of Americans 16 and older has grown by 13 million since then. As a result, a much smaller proportion of people are either working or looking for work.
• Unemployment rate: When the recession began, unemployment was 5 percent. Now, it’s 7.6 percent. Probably no figure better illustrates the downturn’s lingering damage.
• Housing: The housing market still hasn’t reached normal levels. Previously occupied homes were sold in February at an adjusted annual rate of about 4.98 million. An annual rate of about 5.5 million would be healthy. In the recession, sales had bottomed at 3.8 million.