The Great Recession of 2007-2009 hit hardest in two areas: sun-belt states such as Arizona and Florida that were exposed by the housing boom and bust, as well as rust-belt states like Michigan and Ohio that were already suffering from the erosion of America’s manufacturing base. Interestingly enough, Texas and the Midwest, which bore the brunt of the 1980-1982 recession, managed to escape most of the pain this time around.
The worst-off communities in this cycle were the focus of a conference this morning organised by the Brookings Institution’s Hamilton Project, which conducts research on economic policy and counts Robert Rubin, former treasury secretary, and Roger Altman, former deputy treasury secretary, as senior advisers. Read more
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Last week’s dispiriting jobs report has led to pervasive pessimism about the state of the US labour market specifically and the pace of the recovery more in general.
So it was quite refreshing to see a research note land in my inbox this morning from Milton Ezrati, senior economist and market strategist at Lord Abbett, a fund manager, laying out the case why the labour market recovery is actually proceeding ahead of schedule compared to other recoveries.
Mr Ezrati’s argument is based on measuring this cycle’s labour market recovery with the average time that it taken a variety of labour market indicators to rebound after gross domestic product hits its trough during previous cycles. Read more
For several months, Ben Bernanke, Federal Reserve chairman, has increased the drumbeat of warnings from the US central bank about America’s soaring deficit.
Although the Fed typically shies away from entering the politically-tricky terrain of fiscal policy, officials also have the duty to speak up if they feel that the fate of the economy could be at stake – and Mr Bernanke has not been shy about pointing out that rising debt levels are a long-term threat to the US economy.
His message seems to be resonating more loudly on Capitol Hill, where conservative Democratic lawmakers joined Republicans in blocking an extension of unemployment benefits and other measures to help stimulate the economy on the grounds that government spending had to stop.
Indeed, Steny Hoyer, the House majority leader and frequent ally of fiscally conservative Democrats, today said America’s debt level was a huge national security problem. “It’s time to stop talking about Read more
US lawmakers may not be known for paying too close attention to every twist and turn in economic indicators.
But as the House of Representatives prepares to vote on a new jobs bill worth $150bn – the biggest stimulus package since the mega-stimulus approved in the early days of the Obama administration last year, members might consider today’s downward revision to US GDP. Read more
Overly-generous unemployment benefits are not by any stretch a major factor behind the surge in long-term US joblessness. Or at least this is what economists at the Federal Reserve Bank of San Francisco argue in a research report released on Monday.
In examining the topic, Rob Valletta and Katherine Kuang of the SF Fed are wading into an area that is of great concern to policymakers and also been a source of tension between Democrats and Republicans on Capitol Hill. Read more
Today’s report showing the US economy lost 85,000 jobs dashed hopes that the economy had finally stopped sloughing of jobs. Or did it? Very likely, but we won’t know for sure for a few months. After all, according to the latest release we gained jobs in November, after we had thought for a month that payrolls were still falling. Granted, it was a smaller original decline, but the BLS’s revisions of unemployment over the past few months have been striking. Read more