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8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 16
1 Center for American Progress | Economic Snapshot December 2013
Economic Snapshot December 2013
Christian E Weller on the State of the Economy
By Christian E Weller and Sam Ungar December 19 2013
People are angry a he policy responses o he economyrsquos subpar perormance because
policymakers seem o have given up rying o help he millions o Americans who are
sill sruggling Policymakers in Washingon or example are now celebraing a bipar-
isan budge deal ha ends exended unemploymen benefis or millions o long-erm
unemployed workers Observers can breahe easier because his ime radical conserva-ives did no hold he governmenrsquos finances hosage o heir demands and anoher
governmen shudown has been avoided I is indeed a very low bar or Americansrsquo
expecaions o policymakers i people are saisfied when hey do no wreak havoc on
governmen finances and he economy
Bu American ciizens should no be saisfied and should demand more All economic
measures ha mater o he majoriy o people991252job growh economic growh pro-
duciviy growh povery reducion and income growh991252have perormed worse in
his recovery which sared in June 2009 han in previous recoveries o a leas equal
lengh1
Middle-class amilies coninue o sruggle in he wake o he Grea Recessionand are looking or help rom heir eleced officials
Te curren economy only works or hose lucky ew wih high incomes who depend
in large measure on corporae profis hrough dividends and sock marke gains or
heir financial well-being Income inequaliy sayed high and increased hroughou he
recovery Corporae profis recovered more quickly han in previous recoveries o very
high levels
Policymakers need o ocus on building an economy ha works or everybody Tis
will no happen overnigh and will require a wide range o comprehensive policies o
grow he economy rom he middle ou Such policies include invesmens in educaion
higher minimum wages more opporuniies o join a union and beter help or people
who wan o save
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 26
2 Center for American Progress | Economic Snapshot December 2013
1 Economic growth lags behind previous recoveries Gross domesic produc or
GDP increased in he hird quarer o 2013 a an inflaion-adjused annual rae o 36
percen Domesic consumpion increased by an annual rae o 14 percen housing
spending subsanially grew by 13 percen while business invesmen growh slowed
o 35 percen Expors increased by 37 percen in he firs quarer and governmen
spending was essenially fla wih an increase o only 04 percen2 Te economy
has now expanded by 102 percen rom June 2009 o Sepember 2013991252is slowesexpansion during recoveries o a leas equal lengh3 Policymakers need o ocus on
srenghening key pars o economic growh paricularly invesmen and expors
wih argeed measures ha go beyond remov-
ing fiscal uncerainy
2 Improvements to US competitiveness lag
behind previous business cycles Produciviy
growh measured as he increase in inflaion-
adjused oupu per hour is key o increasing liv-
ing sandards US produciviy has risen by 64percen rom June 2009 o Sepember 2013 he
firs 17 quarers o he economic recovery since
he end o he Grea Recession4 Tis compares
o an average o 114 percen during all previous
recoveries o a leas equal lengh5 No previous
recovery had lower produciviy growh han
he curren one Produciviy growh is he main
driving orce or he counryrsquos abiliy o raise liv-
ing sandards Weaker produciviy growh han
in he pas will make i harder o build a srongmiddle class requiring policymakersrsquo atenion
o inves in US compeiiveness
3 The housing market continues to recover from
historic lows New-home sales amouned o
an annual rae o 444000 in Ocober 2013991252a
216 percen increase rom he 365000 homes
sold in Ocober 2012 bu well below he hisor-
ical average o 698000 homes sold beore he
Grea Recession6 Te median new-home price
in Ocober 2013 was $245800 down slighly
rom one year earlier7 Exising-home sales
were up by 6 percen in Ocober 2013 rom one
year earlier and he median price or exising
homes was up by 128 percen during he same
period8 Home sales have o go a lo urher
given ha homeownership in he Unied Saes
FIGURE 1
GDP growth in recovery in comparison
to previous recoveries
90
120
125
130
115
110
105
100
95
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17
G r o w t h i n d e x ( l a s t q u a r t e r o f r e
c e s s i o n = 1 0 0 )
Mar rsquo61
Mar rsquo75
Dec rsquo82
Mar rsquo91
Dec rsquo01
Jun rsquo09
Number of quarters of economic recovery
Recovery after the Great Recession
Source Authorsrsquo calculations based on US Bureau of Economic Analysis National Income and Product Accounts
(US Department of Commerce 2013) Calculations only done for recoveries that have lasted at least four years
FIGURE 2
Productivity growth in recovery compared
to previous recoveries
0
2
4
6
8
10
12
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17
Average previous recoveries
Current economic recovery
Source Authorsrsquo calculations based on productivity growth (output per hour) from US Bureau of Labor
Statistics Current Employment Statistics (US Department of Labor 2013)
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 36
3 Center for American Progress | Economic Snapshot December 2013
sood a 653 percen in he hird quarer o 2013 down rom 682 percen beore
he recession Te curren homeownership raes are similar o hose recorded in
1996 well beore he mos recen housing bubble sared9 Alhough he housing-
marke recovery sared laer han he wider economic recovery991252and sared ou
a a record low991252he housing marke has laely conribued a much-needed boos
o economic progress As such here is sill pleny o room or he housing marke
o provide more simulaion o he economy more broadly Te fledgling housingrecovery could gain urher srengh i policymakers suppor economic growh and
job creaion a he same ime
4 Moderate labor-market recovery shows less job growth than in previous recoveries Tere were 62 million more jobs in November 2013 han in June 2009 Te privae
secor added 69 million jobs during his period Te loss o nearly 620000 sae and
local governmen jobs explains he difference beween he ne gain o all jobs and
he privae-secor gain in his period Budge cus reduced he number o eachers
bus drivers firefighers and police officers among ohers10 Te oal number o jobs
has now grown by 47 percen during his recovery compared o an average o 116percen during all prior recoveries o a leas equal lengh11 Tose looking or jobs
sill need assisance such as exended unemploymen insurance benefis
5 Employment opportunities grow very slowly for people in their prime earning
years Te employed share o he populaion rom ages 25 o 54991252which is una-
eced by he aging o he overall populaion991252was 759 percen in November 2013
Tis was he same level as in June 2009 and
well below he levels since he mid-1980s and
beore he Grea Recession sared in 2007
Te employed share o he populaion has onaverage grown by 3 percenage poins a his
sage during previous recoveries o a leas
equal lengh12 Specifically here has been
insufficien job growh o creae real economic
opporuniies or people in he mids o heir
main earning years when hey need hose
opporuniies he mos
6 Employer-sponsored benefits disappear Te
share o people wih employer-sponsored
healh insurance dropped rom 598 percen in
2007 o 549 percen in 2012 he mos recen
year or which daa are available13 Te share
o privae-secor workers who paricipaed in
a reiremen plan a work ell o 394 percen
in 2012 down rom 415 percen in 200714
FIGURE 3
Employment-to-population rate for 25ndash54 year-olds
1947ndash2013
60
80
1 9 4 8
1 9 5 3
1 9 5 8
1 9 6 3
1 9 6 8
1 9 7 3
1 9 7 8
1 9 8 3
1 9 8 8
1 9 9 3
1 9 9 8
2 0 0 3
2 0 0 8
2 0 1 3
65
70
75
85
S
h a r e
o f p o p u l a t i o n (
i n p
e r c e n t )
Source US Bureau of Labor Statistics Current Population Survey (US Department of Labor 2013)
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 46
4 Center for American Progress | Economic Snapshot December 2013
Families now have less economic securiy han in he pas due o ewer employ-
men-based benefis which requires hem o have more privae savings o make up
he difference
7 Some communities continue to struggle disproportionately from unemployment Te unemploymen rae sood a 7 percen in November 2013 Te Arican
American unemploymen rae was 125 percen he Hispanic unemploymen rae was 87 percen and he whie unemploymen rae was 62 percen Meanwhile
youh unemploymen sood a 208 percen Te unemploymen rae or people
wihou a high school diploma icked down o 108 percen compared o 73 percen
or hose wih a high school degree 64 percen or hose wih some college educa-
ion and 34 percen or hose wih a college degree15 Populaion groups wih higher
unemploymen raes have sruggled disproporionaely more amid he weak labor
marke han whie workers older workers and workers wih more educaion
8 The rich continue to pull away from most Americans Incomes o households in he
95h percenile991252hose wih incomes o $191000 in 2012 he mos recen year or which daa are available991252were more han nine imes he incomes o households in
he 20h percenile whose incomes were $20599 Tis is he larges gap beween
he op 5 percen and he botom 20 percen o households since he US Census
Bureau sared keeping records in 1967 Median inflaion-adjused household
income sood a $51017 in 2012 is lowes level in inflaion-adjused dollars since
1995 And he povery rae remains high991252a 15 percen in 2012991252as he economic
slump coninues o ake a massive oll on he mos vulnerable ciizens16
9 Corporate profits stay high near pre-crisis peaks Inflaion-adjused corporae
profis were 85 percen larger in Sepember 2013 han in June 2009 Te afer-axcorporae-profi rae991252profis o oal asses991252sood a 32 percen in Sepember
2013 nearing he previous peak afer-ax profi rae o 33 percen ha occurred
prior o he Grea Recession17 Corporae profis recovered quickly during he eco-
nomic recovery highlighing he biurcaed naure o he economy
10 Corporations spend much of their money to keep shareholders happy From
December 2007991252when he Grea Recession sared991252o Sepember 2013 nonfi-
nancial corporaions spen on average 98 percen o heir afer-ax profis on divi-
dend payous and share repurchases18 In shor almos all o nonfinancial corporae
afer-ax profis wen o keep shareholders happy during he curren business cycle
Nonfinancial corporaions also held on average 53 percen o all o heir asses in
cash991252he highes average share since he business cycle ha ended in December
1969 Nonfinancial corporaions spen on average 1687 percen o heir afer-ax
profis on capial expendiures or invesmens991252by selling oher asses and by bor-
rowing Tis was he lowes raio since he business cycle ha ended in 1960 US
corporaions have prioriized keeping shareholders happy and building up cash over
invesmens in srucures and equipmen
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 56
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 66
6 Center for American Progress | Economic Snapshot December 2013
Endnotes
1 There have been five recoveries that lasted at least 53months since World War II National Bureau of EconomicResearch ldquoBusiness Cycle Expansions and Contractionsrdquo(2013)
2 US Bureau of Economic Analysis National Income andProduct Accounts (US Department of Commerce 2013)
3 Ibid
4 Calculations are based on productivity growth (output perhour) for nonfarm businesses from US Bureau of Labo rStatistics Current Employment Statistics (US Department ofLabor 2013)
5 Ibid
6 The historical average refers to the average annualizedmonthly residential sales from January 1963 when theCensus data started to December 2007 when the GreatRecession started Calculations are based on Bureau of theCensus New Residential Sales Historical Data (US Depart-ment of Commerce 2013)
7 Ibid
8 National Association of Realtors ldquoExisting-Home Sales and
Prices Continue to Rise in Februaryrdquo (2013)
9 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2013)
10 Employment-growth data are calculated based on USBureau of Labor Statistics Current Employment Statistics
11 Ibid
12 Calculations based on US Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2013)
13 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2012 (US Department of Com-merce 2013) This report is occasionally referred to as thepoverty report
14 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
15 Unemployment numbers are taken from US Bureau ofLabor Statistics Current Population Survey
16 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2012
17 Profit rates are calculated based on data from Board of Gov-ernors of the Federal Reserve System ldquoRelease Z1 FinancialAccounts of the United Statesrdquo (2013) Inflation adjustmentsare based on the Personal Consumption Expenditure Indexfrom US Bureau of Economic Analysis National Income andProduct Accounts
18 Calculations based on Board of Governors of the Federal Re-serve System ldquoRelease Z1 Financial Accounts of the United
Statesrdquo
19 Calculations based on Bureau of the Census Income Povertyand Health Insurance Coverage in the United States 2012
20 Calculations based on Board of Governors of the Federal Re-serve System ldquoRelease Z1 Financial Accounts of the UnitedStatesrdquo
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 26
2 Center for American Progress | Economic Snapshot December 2013
1 Economic growth lags behind previous recoveries Gross domesic produc or
GDP increased in he hird quarer o 2013 a an inflaion-adjused annual rae o 36
percen Domesic consumpion increased by an annual rae o 14 percen housing
spending subsanially grew by 13 percen while business invesmen growh slowed
o 35 percen Expors increased by 37 percen in he firs quarer and governmen
spending was essenially fla wih an increase o only 04 percen2 Te economy
has now expanded by 102 percen rom June 2009 o Sepember 2013991252is slowesexpansion during recoveries o a leas equal lengh3 Policymakers need o ocus on
srenghening key pars o economic growh paricularly invesmen and expors
wih argeed measures ha go beyond remov-
ing fiscal uncerainy
2 Improvements to US competitiveness lag
behind previous business cycles Produciviy
growh measured as he increase in inflaion-
adjused oupu per hour is key o increasing liv-
ing sandards US produciviy has risen by 64percen rom June 2009 o Sepember 2013 he
firs 17 quarers o he economic recovery since
he end o he Grea Recession4 Tis compares
o an average o 114 percen during all previous
recoveries o a leas equal lengh5 No previous
recovery had lower produciviy growh han
he curren one Produciviy growh is he main
driving orce or he counryrsquos abiliy o raise liv-
ing sandards Weaker produciviy growh han
in he pas will make i harder o build a srongmiddle class requiring policymakersrsquo atenion
o inves in US compeiiveness
3 The housing market continues to recover from
historic lows New-home sales amouned o
an annual rae o 444000 in Ocober 2013991252a
216 percen increase rom he 365000 homes
sold in Ocober 2012 bu well below he hisor-
ical average o 698000 homes sold beore he
Grea Recession6 Te median new-home price
in Ocober 2013 was $245800 down slighly
rom one year earlier7 Exising-home sales
were up by 6 percen in Ocober 2013 rom one
year earlier and he median price or exising
homes was up by 128 percen during he same
period8 Home sales have o go a lo urher
given ha homeownership in he Unied Saes
FIGURE 1
GDP growth in recovery in comparison
to previous recoveries
90
120
125
130
115
110
105
100
95
0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17
G r o w t h i n d e x ( l a s t q u a r t e r o f r e
c e s s i o n = 1 0 0 )
Mar rsquo61
Mar rsquo75
Dec rsquo82
Mar rsquo91
Dec rsquo01
Jun rsquo09
Number of quarters of economic recovery
Recovery after the Great Recession
Source Authorsrsquo calculations based on US Bureau of Economic Analysis National Income and Product Accounts
(US Department of Commerce 2013) Calculations only done for recoveries that have lasted at least four years
FIGURE 2
Productivity growth in recovery compared
to previous recoveries
0
2
4
6
8
10
12
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17
Average previous recoveries
Current economic recovery
Source Authorsrsquo calculations based on productivity growth (output per hour) from US Bureau of Labor
Statistics Current Employment Statistics (US Department of Labor 2013)
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 36
3 Center for American Progress | Economic Snapshot December 2013
sood a 653 percen in he hird quarer o 2013 down rom 682 percen beore
he recession Te curren homeownership raes are similar o hose recorded in
1996 well beore he mos recen housing bubble sared9 Alhough he housing-
marke recovery sared laer han he wider economic recovery991252and sared ou
a a record low991252he housing marke has laely conribued a much-needed boos
o economic progress As such here is sill pleny o room or he housing marke
o provide more simulaion o he economy more broadly Te fledgling housingrecovery could gain urher srengh i policymakers suppor economic growh and
job creaion a he same ime
4 Moderate labor-market recovery shows less job growth than in previous recoveries Tere were 62 million more jobs in November 2013 han in June 2009 Te privae
secor added 69 million jobs during his period Te loss o nearly 620000 sae and
local governmen jobs explains he difference beween he ne gain o all jobs and
he privae-secor gain in his period Budge cus reduced he number o eachers
bus drivers firefighers and police officers among ohers10 Te oal number o jobs
has now grown by 47 percen during his recovery compared o an average o 116percen during all prior recoveries o a leas equal lengh11 Tose looking or jobs
sill need assisance such as exended unemploymen insurance benefis
5 Employment opportunities grow very slowly for people in their prime earning
years Te employed share o he populaion rom ages 25 o 54991252which is una-
eced by he aging o he overall populaion991252was 759 percen in November 2013
Tis was he same level as in June 2009 and
well below he levels since he mid-1980s and
beore he Grea Recession sared in 2007
Te employed share o he populaion has onaverage grown by 3 percenage poins a his
sage during previous recoveries o a leas
equal lengh12 Specifically here has been
insufficien job growh o creae real economic
opporuniies or people in he mids o heir
main earning years when hey need hose
opporuniies he mos
6 Employer-sponsored benefits disappear Te
share o people wih employer-sponsored
healh insurance dropped rom 598 percen in
2007 o 549 percen in 2012 he mos recen
year or which daa are available13 Te share
o privae-secor workers who paricipaed in
a reiremen plan a work ell o 394 percen
in 2012 down rom 415 percen in 200714
FIGURE 3
Employment-to-population rate for 25ndash54 year-olds
1947ndash2013
60
80
1 9 4 8
1 9 5 3
1 9 5 8
1 9 6 3
1 9 6 8
1 9 7 3
1 9 7 8
1 9 8 3
1 9 8 8
1 9 9 3
1 9 9 8
2 0 0 3
2 0 0 8
2 0 1 3
65
70
75
85
S
h a r e
o f p o p u l a t i o n (
i n p
e r c e n t )
Source US Bureau of Labor Statistics Current Population Survey (US Department of Labor 2013)
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 46
4 Center for American Progress | Economic Snapshot December 2013
Families now have less economic securiy han in he pas due o ewer employ-
men-based benefis which requires hem o have more privae savings o make up
he difference
7 Some communities continue to struggle disproportionately from unemployment Te unemploymen rae sood a 7 percen in November 2013 Te Arican
American unemploymen rae was 125 percen he Hispanic unemploymen rae was 87 percen and he whie unemploymen rae was 62 percen Meanwhile
youh unemploymen sood a 208 percen Te unemploymen rae or people
wihou a high school diploma icked down o 108 percen compared o 73 percen
or hose wih a high school degree 64 percen or hose wih some college educa-
ion and 34 percen or hose wih a college degree15 Populaion groups wih higher
unemploymen raes have sruggled disproporionaely more amid he weak labor
marke han whie workers older workers and workers wih more educaion
8 The rich continue to pull away from most Americans Incomes o households in he
95h percenile991252hose wih incomes o $191000 in 2012 he mos recen year or which daa are available991252were more han nine imes he incomes o households in
he 20h percenile whose incomes were $20599 Tis is he larges gap beween
he op 5 percen and he botom 20 percen o households since he US Census
Bureau sared keeping records in 1967 Median inflaion-adjused household
income sood a $51017 in 2012 is lowes level in inflaion-adjused dollars since
1995 And he povery rae remains high991252a 15 percen in 2012991252as he economic
slump coninues o ake a massive oll on he mos vulnerable ciizens16
9 Corporate profits stay high near pre-crisis peaks Inflaion-adjused corporae
profis were 85 percen larger in Sepember 2013 han in June 2009 Te afer-axcorporae-profi rae991252profis o oal asses991252sood a 32 percen in Sepember
2013 nearing he previous peak afer-ax profi rae o 33 percen ha occurred
prior o he Grea Recession17 Corporae profis recovered quickly during he eco-
nomic recovery highlighing he biurcaed naure o he economy
10 Corporations spend much of their money to keep shareholders happy From
December 2007991252when he Grea Recession sared991252o Sepember 2013 nonfi-
nancial corporaions spen on average 98 percen o heir afer-ax profis on divi-
dend payous and share repurchases18 In shor almos all o nonfinancial corporae
afer-ax profis wen o keep shareholders happy during he curren business cycle
Nonfinancial corporaions also held on average 53 percen o all o heir asses in
cash991252he highes average share since he business cycle ha ended in December
1969 Nonfinancial corporaions spen on average 1687 percen o heir afer-ax
profis on capial expendiures or invesmens991252by selling oher asses and by bor-
rowing Tis was he lowes raio since he business cycle ha ended in 1960 US
corporaions have prioriized keeping shareholders happy and building up cash over
invesmens in srucures and equipmen
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 56
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 66
6 Center for American Progress | Economic Snapshot December 2013
Endnotes
1 There have been five recoveries that lasted at least 53months since World War II National Bureau of EconomicResearch ldquoBusiness Cycle Expansions and Contractionsrdquo(2013)
2 US Bureau of Economic Analysis National Income andProduct Accounts (US Department of Commerce 2013)
3 Ibid
4 Calculations are based on productivity growth (output perhour) for nonfarm businesses from US Bureau of Labo rStatistics Current Employment Statistics (US Department ofLabor 2013)
5 Ibid
6 The historical average refers to the average annualizedmonthly residential sales from January 1963 when theCensus data started to December 2007 when the GreatRecession started Calculations are based on Bureau of theCensus New Residential Sales Historical Data (US Depart-ment of Commerce 2013)
7 Ibid
8 National Association of Realtors ldquoExisting-Home Sales and
Prices Continue to Rise in Februaryrdquo (2013)
9 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2013)
10 Employment-growth data are calculated based on USBureau of Labor Statistics Current Employment Statistics
11 Ibid
12 Calculations based on US Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2013)
13 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2012 (US Department of Com-merce 2013) This report is occasionally referred to as thepoverty report
14 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
15 Unemployment numbers are taken from US Bureau ofLabor Statistics Current Population Survey
16 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2012
17 Profit rates are calculated based on data from Board of Gov-ernors of the Federal Reserve System ldquoRelease Z1 FinancialAccounts of the United Statesrdquo (2013) Inflation adjustmentsare based on the Personal Consumption Expenditure Indexfrom US Bureau of Economic Analysis National Income andProduct Accounts
18 Calculations based on Board of Governors of the Federal Re-serve System ldquoRelease Z1 Financial Accounts of the United
Statesrdquo
19 Calculations based on Bureau of the Census Income Povertyand Health Insurance Coverage in the United States 2012
20 Calculations based on Board of Governors of the Federal Re-serve System ldquoRelease Z1 Financial Accounts of the UnitedStatesrdquo
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 36
3 Center for American Progress | Economic Snapshot December 2013
sood a 653 percen in he hird quarer o 2013 down rom 682 percen beore
he recession Te curren homeownership raes are similar o hose recorded in
1996 well beore he mos recen housing bubble sared9 Alhough he housing-
marke recovery sared laer han he wider economic recovery991252and sared ou
a a record low991252he housing marke has laely conribued a much-needed boos
o economic progress As such here is sill pleny o room or he housing marke
o provide more simulaion o he economy more broadly Te fledgling housingrecovery could gain urher srengh i policymakers suppor economic growh and
job creaion a he same ime
4 Moderate labor-market recovery shows less job growth than in previous recoveries Tere were 62 million more jobs in November 2013 han in June 2009 Te privae
secor added 69 million jobs during his period Te loss o nearly 620000 sae and
local governmen jobs explains he difference beween he ne gain o all jobs and
he privae-secor gain in his period Budge cus reduced he number o eachers
bus drivers firefighers and police officers among ohers10 Te oal number o jobs
has now grown by 47 percen during his recovery compared o an average o 116percen during all prior recoveries o a leas equal lengh11 Tose looking or jobs
sill need assisance such as exended unemploymen insurance benefis
5 Employment opportunities grow very slowly for people in their prime earning
years Te employed share o he populaion rom ages 25 o 54991252which is una-
eced by he aging o he overall populaion991252was 759 percen in November 2013
Tis was he same level as in June 2009 and
well below he levels since he mid-1980s and
beore he Grea Recession sared in 2007
Te employed share o he populaion has onaverage grown by 3 percenage poins a his
sage during previous recoveries o a leas
equal lengh12 Specifically here has been
insufficien job growh o creae real economic
opporuniies or people in he mids o heir
main earning years when hey need hose
opporuniies he mos
6 Employer-sponsored benefits disappear Te
share o people wih employer-sponsored
healh insurance dropped rom 598 percen in
2007 o 549 percen in 2012 he mos recen
year or which daa are available13 Te share
o privae-secor workers who paricipaed in
a reiremen plan a work ell o 394 percen
in 2012 down rom 415 percen in 200714
FIGURE 3
Employment-to-population rate for 25ndash54 year-olds
1947ndash2013
60
80
1 9 4 8
1 9 5 3
1 9 5 8
1 9 6 3
1 9 6 8
1 9 7 3
1 9 7 8
1 9 8 3
1 9 8 8
1 9 9 3
1 9 9 8
2 0 0 3
2 0 0 8
2 0 1 3
65
70
75
85
S
h a r e
o f p o p u l a t i o n (
i n p
e r c e n t )
Source US Bureau of Labor Statistics Current Population Survey (US Department of Labor 2013)
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 46
4 Center for American Progress | Economic Snapshot December 2013
Families now have less economic securiy han in he pas due o ewer employ-
men-based benefis which requires hem o have more privae savings o make up
he difference
7 Some communities continue to struggle disproportionately from unemployment Te unemploymen rae sood a 7 percen in November 2013 Te Arican
American unemploymen rae was 125 percen he Hispanic unemploymen rae was 87 percen and he whie unemploymen rae was 62 percen Meanwhile
youh unemploymen sood a 208 percen Te unemploymen rae or people
wihou a high school diploma icked down o 108 percen compared o 73 percen
or hose wih a high school degree 64 percen or hose wih some college educa-
ion and 34 percen or hose wih a college degree15 Populaion groups wih higher
unemploymen raes have sruggled disproporionaely more amid he weak labor
marke han whie workers older workers and workers wih more educaion
8 The rich continue to pull away from most Americans Incomes o households in he
95h percenile991252hose wih incomes o $191000 in 2012 he mos recen year or which daa are available991252were more han nine imes he incomes o households in
he 20h percenile whose incomes were $20599 Tis is he larges gap beween
he op 5 percen and he botom 20 percen o households since he US Census
Bureau sared keeping records in 1967 Median inflaion-adjused household
income sood a $51017 in 2012 is lowes level in inflaion-adjused dollars since
1995 And he povery rae remains high991252a 15 percen in 2012991252as he economic
slump coninues o ake a massive oll on he mos vulnerable ciizens16
9 Corporate profits stay high near pre-crisis peaks Inflaion-adjused corporae
profis were 85 percen larger in Sepember 2013 han in June 2009 Te afer-axcorporae-profi rae991252profis o oal asses991252sood a 32 percen in Sepember
2013 nearing he previous peak afer-ax profi rae o 33 percen ha occurred
prior o he Grea Recession17 Corporae profis recovered quickly during he eco-
nomic recovery highlighing he biurcaed naure o he economy
10 Corporations spend much of their money to keep shareholders happy From
December 2007991252when he Grea Recession sared991252o Sepember 2013 nonfi-
nancial corporaions spen on average 98 percen o heir afer-ax profis on divi-
dend payous and share repurchases18 In shor almos all o nonfinancial corporae
afer-ax profis wen o keep shareholders happy during he curren business cycle
Nonfinancial corporaions also held on average 53 percen o all o heir asses in
cash991252he highes average share since he business cycle ha ended in December
1969 Nonfinancial corporaions spen on average 1687 percen o heir afer-ax
profis on capial expendiures or invesmens991252by selling oher asses and by bor-
rowing Tis was he lowes raio since he business cycle ha ended in 1960 US
corporaions have prioriized keeping shareholders happy and building up cash over
invesmens in srucures and equipmen
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 56
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 66
6 Center for American Progress | Economic Snapshot December 2013
Endnotes
1 There have been five recoveries that lasted at least 53months since World War II National Bureau of EconomicResearch ldquoBusiness Cycle Expansions and Contractionsrdquo(2013)
2 US Bureau of Economic Analysis National Income andProduct Accounts (US Department of Commerce 2013)
3 Ibid
4 Calculations are based on productivity growth (output perhour) for nonfarm businesses from US Bureau of Labo rStatistics Current Employment Statistics (US Department ofLabor 2013)
5 Ibid
6 The historical average refers to the average annualizedmonthly residential sales from January 1963 when theCensus data started to December 2007 when the GreatRecession started Calculations are based on Bureau of theCensus New Residential Sales Historical Data (US Depart-ment of Commerce 2013)
7 Ibid
8 National Association of Realtors ldquoExisting-Home Sales and
Prices Continue to Rise in Februaryrdquo (2013)
9 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2013)
10 Employment-growth data are calculated based on USBureau of Labor Statistics Current Employment Statistics
11 Ibid
12 Calculations based on US Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2013)
13 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2012 (US Department of Com-merce 2013) This report is occasionally referred to as thepoverty report
14 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
15 Unemployment numbers are taken from US Bureau ofLabor Statistics Current Population Survey
16 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2012
17 Profit rates are calculated based on data from Board of Gov-ernors of the Federal Reserve System ldquoRelease Z1 FinancialAccounts of the United Statesrdquo (2013) Inflation adjustmentsare based on the Personal Consumption Expenditure Indexfrom US Bureau of Economic Analysis National Income andProduct Accounts
18 Calculations based on Board of Governors of the Federal Re-serve System ldquoRelease Z1 Financial Accounts of the United
Statesrdquo
19 Calculations based on Bureau of the Census Income Povertyand Health Insurance Coverage in the United States 2012
20 Calculations based on Board of Governors of the Federal Re-serve System ldquoRelease Z1 Financial Accounts of the UnitedStatesrdquo
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 46
4 Center for American Progress | Economic Snapshot December 2013
Families now have less economic securiy han in he pas due o ewer employ-
men-based benefis which requires hem o have more privae savings o make up
he difference
7 Some communities continue to struggle disproportionately from unemployment Te unemploymen rae sood a 7 percen in November 2013 Te Arican
American unemploymen rae was 125 percen he Hispanic unemploymen rae was 87 percen and he whie unemploymen rae was 62 percen Meanwhile
youh unemploymen sood a 208 percen Te unemploymen rae or people
wihou a high school diploma icked down o 108 percen compared o 73 percen
or hose wih a high school degree 64 percen or hose wih some college educa-
ion and 34 percen or hose wih a college degree15 Populaion groups wih higher
unemploymen raes have sruggled disproporionaely more amid he weak labor
marke han whie workers older workers and workers wih more educaion
8 The rich continue to pull away from most Americans Incomes o households in he
95h percenile991252hose wih incomes o $191000 in 2012 he mos recen year or which daa are available991252were more han nine imes he incomes o households in
he 20h percenile whose incomes were $20599 Tis is he larges gap beween
he op 5 percen and he botom 20 percen o households since he US Census
Bureau sared keeping records in 1967 Median inflaion-adjused household
income sood a $51017 in 2012 is lowes level in inflaion-adjused dollars since
1995 And he povery rae remains high991252a 15 percen in 2012991252as he economic
slump coninues o ake a massive oll on he mos vulnerable ciizens16
9 Corporate profits stay high near pre-crisis peaks Inflaion-adjused corporae
profis were 85 percen larger in Sepember 2013 han in June 2009 Te afer-axcorporae-profi rae991252profis o oal asses991252sood a 32 percen in Sepember
2013 nearing he previous peak afer-ax profi rae o 33 percen ha occurred
prior o he Grea Recession17 Corporae profis recovered quickly during he eco-
nomic recovery highlighing he biurcaed naure o he economy
10 Corporations spend much of their money to keep shareholders happy From
December 2007991252when he Grea Recession sared991252o Sepember 2013 nonfi-
nancial corporaions spen on average 98 percen o heir afer-ax profis on divi-
dend payous and share repurchases18 In shor almos all o nonfinancial corporae
afer-ax profis wen o keep shareholders happy during he curren business cycle
Nonfinancial corporaions also held on average 53 percen o all o heir asses in
cash991252he highes average share since he business cycle ha ended in December
1969 Nonfinancial corporaions spen on average 1687 percen o heir afer-ax
profis on capial expendiures or invesmens991252by selling oher asses and by bor-
rowing Tis was he lowes raio since he business cycle ha ended in 1960 US
corporaions have prioriized keeping shareholders happy and building up cash over
invesmens in srucures and equipmen
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 56
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 66
6 Center for American Progress | Economic Snapshot December 2013
Endnotes
1 There have been five recoveries that lasted at least 53months since World War II National Bureau of EconomicResearch ldquoBusiness Cycle Expansions and Contractionsrdquo(2013)
2 US Bureau of Economic Analysis National Income andProduct Accounts (US Department of Commerce 2013)
3 Ibid
4 Calculations are based on productivity growth (output perhour) for nonfarm businesses from US Bureau of Labo rStatistics Current Employment Statistics (US Department ofLabor 2013)
5 Ibid
6 The historical average refers to the average annualizedmonthly residential sales from January 1963 when theCensus data started to December 2007 when the GreatRecession started Calculations are based on Bureau of theCensus New Residential Sales Historical Data (US Depart-ment of Commerce 2013)
7 Ibid
8 National Association of Realtors ldquoExisting-Home Sales and
Prices Continue to Rise in Februaryrdquo (2013)
9 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2013)
10 Employment-growth data are calculated based on USBureau of Labor Statistics Current Employment Statistics
11 Ibid
12 Calculations based on US Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2013)
13 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2012 (US Department of Com-merce 2013) This report is occasionally referred to as thepoverty report
14 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
15 Unemployment numbers are taken from US Bureau ofLabor Statistics Current Population Survey
16 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2012
17 Profit rates are calculated based on data from Board of Gov-ernors of the Federal Reserve System ldquoRelease Z1 FinancialAccounts of the United Statesrdquo (2013) Inflation adjustmentsare based on the Personal Consumption Expenditure Indexfrom US Bureau of Economic Analysis National Income andProduct Accounts
18 Calculations based on Board of Governors of the Federal Re-serve System ldquoRelease Z1 Financial Accounts of the United
Statesrdquo
19 Calculations based on Bureau of the Census Income Povertyand Health Insurance Coverage in the United States 2012
20 Calculations based on Board of Governors of the Federal Re-serve System ldquoRelease Z1 Financial Accounts of the UnitedStatesrdquo
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 56
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 66
6 Center for American Progress | Economic Snapshot December 2013
Endnotes
1 There have been five recoveries that lasted at least 53months since World War II National Bureau of EconomicResearch ldquoBusiness Cycle Expansions and Contractionsrdquo(2013)
2 US Bureau of Economic Analysis National Income andProduct Accounts (US Department of Commerce 2013)
3 Ibid
4 Calculations are based on productivity growth (output perhour) for nonfarm businesses from US Bureau of Labo rStatistics Current Employment Statistics (US Department ofLabor 2013)
5 Ibid
6 The historical average refers to the average annualizedmonthly residential sales from January 1963 when theCensus data started to December 2007 when the GreatRecession started Calculations are based on Bureau of theCensus New Residential Sales Historical Data (US Depart-ment of Commerce 2013)
7 Ibid
8 National Association of Realtors ldquoExisting-Home Sales and
Prices Continue to Rise in Februaryrdquo (2013)
9 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2013)
10 Employment-growth data are calculated based on USBureau of Labor Statistics Current Employment Statistics
11 Ibid
12 Calculations based on US Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2013)
13 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2012 (US Department of Com-merce 2013) This report is occasionally referred to as thepoverty report
14 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
15 Unemployment numbers are taken from US Bureau ofLabor Statistics Current Population Survey
16 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2012
17 Profit rates are calculated based on data from Board of Gov-ernors of the Federal Reserve System ldquoRelease Z1 FinancialAccounts of the United Statesrdquo (2013) Inflation adjustmentsare based on the Personal Consumption Expenditure Indexfrom US Bureau of Economic Analysis National Income andProduct Accounts
18 Calculations based on Board of Governors of the Federal Re-serve System ldquoRelease Z1 Financial Accounts of the United
Statesrdquo
19 Calculations based on Bureau of the Census Income Povertyand Health Insurance Coverage in the United States 2012
20 Calculations based on Board of Governors of the Federal Re-serve System ldquoRelease Z1 Financial Accounts of the UnitedStatesrdquo
8132019 Economic Snapshot December 2013
httpslidepdfcomreaderfulleconomic-snapshot-december-2013 66
6 Center for American Progress | Economic Snapshot December 2013
Endnotes
1 There have been five recoveries that lasted at least 53months since World War II National Bureau of EconomicResearch ldquoBusiness Cycle Expansions and Contractionsrdquo(2013)
2 US Bureau of Economic Analysis National Income andProduct Accounts (US Department of Commerce 2013)
3 Ibid
4 Calculations are based on productivity growth (output perhour) for nonfarm businesses from US Bureau of Labo rStatistics Current Employment Statistics (US Department ofLabor 2013)
5 Ibid
6 The historical average refers to the average annualizedmonthly residential sales from January 1963 when theCensus data started to December 2007 when the GreatRecession started Calculations are based on Bureau of theCensus New Residential Sales Historical Data (US Depart-ment of Commerce 2013)
7 Ibid
8 National Association of Realtors ldquoExisting-Home Sales and
Prices Continue to Rise in Februaryrdquo (2013)
9 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2013)
10 Employment-growth data are calculated based on USBureau of Labor Statistics Current Employment Statistics
11 Ibid
12 Calculations based on US Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2013)
13 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2012 (US Department of Com-merce 2013) This report is occasionally referred to as thepoverty report
14 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
15 Unemployment numbers are taken from US Bureau ofLabor Statistics Current Population Survey
16 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2012
17 Profit rates are calculated based on data from Board of Gov-ernors of the Federal Reserve System ldquoRelease Z1 FinancialAccounts of the United Statesrdquo (2013) Inflation adjustmentsare based on the Personal Consumption Expenditure Indexfrom US Bureau of Economic Analysis National Income andProduct Accounts
18 Calculations based on Board of Governors of the Federal Re-serve System ldquoRelease Z1 Financial Accounts of the United
Statesrdquo
19 Calculations based on Bureau of the Census Income Povertyand Health Insurance Coverage in the United States 2012
20 Calculations based on Board of Governors of the Federal Re-serve System ldquoRelease Z1 Financial Accounts of the UnitedStatesrdquo