8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 17
1 Center for American Progress | Economic Snapshot October 2014
Economic Snapshot October 2014
Christian E Weller on the State of the US Economy
By Christian E Weller and Jackie Odum October 27 2014
Tis monhrsquos economic daa show us ha he economy is in much beter shape han a
any oher poin since he Grea Recession ended in June 2009 bu ha isnrsquo saying much
Te Unied Saes economy has reached a posrecession record low o 59 percen in
unemploymen gross domesic produc or GDP increased a an inflaion-adjused
annual rae o 46 percen in he second quarer employmen prospecs have improvedsignificanly or vulnerable populaions and he uninsured rae is a an all-ime posre-
cession low1 However despie hese posrecession landmarks we are sill ar rom an
economy ha works or mos people largely because he economy and he labor marke
have been moving a a comparaively slow pace in his recovery
Inflaion-adjused median household income991252hal o all households had less han ha
and he oher hal more han ha991252was $51939 in 2013 Tis was more han $2000
below he 2009 level and more han $4000 below he median income in 2007 he las
ull year beore he Grea Recession Te povery rae remains slighly higher han i was
in 2009 a 145 percen Bu as he naionrsquos lower- and middle-income amilies sruggleo regain he economic securiy hey once had corporae profis are skyrockeing and
he share o income or he naionrsquos wealhies people coninues o grow rom already
absurdly high levels
Presiden Barack Obama has aken imporan seps oward creaing a posrecession
economy ha works or everyone991252rom his hisoric push or financial reorm and
universal healhcare o a series o execuive orders on equal pay and responsible conracing
Policymakers need o coninue he presidenrsquos effor by implemening common-sense
policies ha boos economic growh and help lower- and middle-class Americans gain
real economic securiy and find meaningul economic opporuniies Such policy
inervenions can sar wih raising he minimum wage exending unemploymen
insurance srenghening workplace policies such as paid amily leave and creaing
effecive savings incenives I is ime or Congress o play is par in building a beter
economy rom he middle ou raher han rom he op down
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 27
2 Center for American Progress | Economic Snapshot October 2014
1 Economic growth in this recovery lags behind that of previous business cycles
GDP increased in he second quarer o 2014 a an inflaion-adjused annual rae o
46 percen afer conracing 21 percen in he previous quarer Domesic con-
sumpion increased by an annual rae o 25 percen and housing spending rose
subsanially by 88 percen while business invesmen growh also increased a a rae
o 97 percen Expors increased 111 percen in he firs quarer which was offse by
even aser impor growh o 113 percen Governmen spending ell 09 percenTe economy expanded 103 percen rom June 2009 o June 2014991252is slowes
expansion during recoveries o a leas equal lengh
2 Improvements to US competitiveness fall behind previous business cycles
Produciviy growh measured as he increase in inflaion-adjused oupu per hour
is key o increasing living sandards as i means ha workers are geting beter a
doing more in he same amoun o ime Slower produciviy growh hus means ha
new economic resources available o improve living sandards are growing more
slowly han would be he case wih aser produciviy growh US produciviy rose
65 percen rom June 2009 o June 2014 he firs 20 quarers o he economic
recovery since he end o he Grea Recession2 Tis compares o an average o 134
percen during all previous recoveries o a leas equal lengh3 No previous recovery
had lower produciviy growh han he curren one
FIGURE 1
GDP growth in recovery in comparison to previous recoveries
90
120
125
130
115
110
105
100
95
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 201918
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
Source Authorsrsquocalculations based on Bureau of Economic Analysis National Income and Product Accounts (US Department of Commerce 2014)
Calculations only done for recoveries that have lasted at l east four years
Recovery after the Great Recession
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 37
3 Center for American Progress | Economic Snapshot October 2014
3 The housing market recovery still struggles to gain momentum New-home sales
amouned o an annual rae o 467000 in Sepember 2014991252a 17 percen increase
rom he 399000 homes sold in Sepember 2013 bu well below he hisorical average
o 698000 homes sold beore he Grea Recession4 Te median new-home price in
Sepember 2014 was $209700 up rom one year earlier5 Exising-home sales increased
by 24 percen in Sepember 2014 rom one year earlier bu he median price or
exising homes was up by 56 percen during he same period6 Home sales have ogo a lo urher given ha homeownership in he Unied Saes sood a 648 percen
in he firs quarer o 2014 down rom 682 percen beore he 2007 recession Te
curren homeownership raes are similar o hose recorded in 1996 well beore he
mos recen housing bubble sared7
A srong housing-marke recovery can boos
economic growh and here is sill pleny o room or he housing marke o provide
more simulaion o he economy more broadly han i did beore he recen slowdown
4 Moderate labor-market recovery shows less job growth than in previous business
cycles Tere were 85 million more jobs in Sepember 2014 han in June 2009 Te
privae secor added 92 million jobs during his period Te loss o some 562000sae 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 ohers8 Te oal number
o jobs has now grown by 65 percen during his recovery compared o an average
o 129 percen during all prior recoveries o a leas equal lengh9
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 unaffeced
by he aging o he overall populaion991252was 767 percen in Sepember 2014 Tis
was jus above he level recorded in June 2009 and well below he levels recordedsince he mid-1980s and beore he Grea Recession sared in 2007 Te employed
share o he populaion has on average grown by 33 percenage poins a his sage
during previous recoveries o a leas equal lengh10
6 Employers cut back on health and pension benefits Te share o people wih
employer-sponsored healh insurance dropped rom 598 percen in 2007 o 539
percen in 2013 he mos recen year or which daa are available11 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 200712 Families now have less economic
securiy han in he pas due o ewer employmen-based benefis which requires
hem o have more privae savings o make up he difference
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 47
4 Center for American Progress | Economic Snapshot October 2014
7 Some communities continue to struggle disproportionately from unemployment
Te unemploymen rae ell o 59 percen in Augus 2014 Te Arican American
unemploymen rae ell o 11 percen he Hispanic unemploymen rae moved
down o 69 percen and he whie unemploymen rae ell slighly o 53 percen
Meanwhile youh unemploymen increased o 20 percen Te unemploymen rae
or people wihou a high school diploma ell o 84 percen compared wih 53
percen or hose wih a high school degree 54 percen or hose wih some collegeeducaion and 29 percen or hose wih a college degree13 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 a
he 95h percenile991252hose wih incomes o $196000 in 2013 he mos recen year
or which daa are available991252were more han nine imes he incomes o households
in he 20h percenile whose incomes were $20900 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 incomesood a $51939 in 2013 is lowes level in inflaion-adjused dollars since 199514
FIGURE 2
Median household income remains far below pre-recession levels
Median household income 2013 dollars
$40000
$50000
$60000
$45000
$55000
2000 2 001 2002 2 003 2004 2 005 2006 2 007 2008 20102009 2011 2012 2013
Note Shaded bars indicate recessions as defined by the National Bureau of Economic Research
Source US Bureau of the Census Table H-6 Regions by Median and Mean Income available at httpwwwcensusgovhheswwwincome-datahistoricalhousehold (last accessed September 2014)
$51939
$56436
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 57
5 Center for American Progress | Economic Snapshot October 2014
9 Corporate profits stay elevated near pre-crisis peaks Inflaion-adjused corporae
profis were 94 percen larger in June 2014 han in June 2009 Te afer-ax corporae
profi rae991252profis o oal asses991252sood a 32 percen in March 201415 Corporae
profis recovered quickly oward he end o he Grea Recession and have sayed
high since hen Addressing income inequaliy ha arises rom he rich receiving
ousized benefis rom heir wealh hrough ax reorm is a crucial policy prioriy
10 Corporations spend much of their money to keep shareholders happy From
December 2007991252when he Grea Recession sared991252o June 2014 nonfinancial
corporaions spen on average 996 percen o heir afer-ax profis on dividend
payous and share repurchases16 In shor almos all o nonfinancial corporae afer-ax
profis have gone o keeping 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 1666 percen o heir afer-ax profis
on capial expendiures or invesmens991252by selling oher asses and by borrowing
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 highlighing he need or regulaory reorm ha
incenivizes corporaions o inves in research and developmen manuacuring
plans and equipmen and workorce developmen
FIGURE 3
Corporate profits stay elevated near pre-recession peaks
After-tax corporate profit rate
Note Shaded bars indicate recessions as defined by the National Bureau of Economic Research
Source Profit rates are calculated based on data from Board of Governors of the Federal Reserve System ldquoZ1 Release--Financial Accounts of theUnited Statesrdquo (2014) Inflation adjustments are based on the Personal Consumption Expenditure Index from Bureau of Economic Analysis National
Income and Product Accounts
05
10
15
20
25
30
35318
D e c - 2 0 0
0
D e c - 2 0 0
1
D e c - 2 0 0
2
D e c - 2 0 0
3
D e c - 2 0 0
4
D e c - 2 0 0
5
D e c - 2 0 0
6
D e c - 2 0 0
7
D e c - 2 0 0
8
D e c - 2 0 0
9
D e c - 2 0 1
0
D e c - 2 0 1
1
D e c - 2 0 1
2
D e c - 2 0 1
3
J u n - 2 0
1 4
251
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 67
6 Center for American Progress | Economic Snapshot October 2014
11 Poverty is still widespread Te povery rae was 145 percen in 2013 down rom
15 percen in 2012 Tis change however was saisically insignifican Moreover
he povery rae or his recovery increased a a rae o 02 percenage poins compared
o an average decrease o 07 percenage poins in previous recoveries o a leas equal
lengh Some populaion groups suffer rom much higher povery rae han ohers
Te Arican American povery rae or insance was 272 percen and he Hispanic
povery rae was 235 percen while he whie povery rae was 96 percen Tepovery rae or children under age 18 ell o 199 percen More han one-hird o
Arican American children991252377 percen991252lived in povery in 2013 compared wih
304 percen o Hispanic children and 107 percen o whie children17
12 Household debt is still high Household deb equaled 1024 percen o afer-ax
income in June 2014 down rom a peak o 1297 percen in December 200718 A
reurn o deb growh oupacing income growh which was he case prior o he sar
o he Grea Recession in 2007 rom already-high deb levels could evenually slow
economic growh again Tis would be especially rue i ineres raes also rise rom
hisorically low levels due o a change in he Federal Reserversquos policies Consumers would have o pay more or heir deb and hey would have less money available or
consumpion and saving
Chrisian E Weller is a Senior Fellow a he Cener for American Progress and a professor in
he Deparmen of Public Policy and Public Affairs a he McCormack Graduae School of
Policy and Global Sudies a he Universiy of Massachusets Boson Jackie Odum is a
Research Assisan for he Economic Policy eam a he Cener
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 77
7 Center for American Progress | Economic Snapshot October 2014
Endnotes
1 Jenna Levy ldquoIn US Uninsured Rate Holds at 134rdquo GallupOctober 8 2014 available at httpwwwgallupcompoll178100uninsured-rate-holdsaspx
2 Calculations are based on productivity growth (output perhour) for nonfarm businesses from Bureau of LaborStatistics Current Employment Statistics (US Department ofLabor 2014)
3 Ibid
4 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 (USDepartment of Commerce 2014)
5 Ibid
6 National Association of Realtors ldquoExisting-Home SalesSlightly Lose Momentum in August as Investor ActivityDeclinesrdquo Press release September 22 2014
7 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2014)
8 Employment-growth data are calculated based on Bureau
of Labor Statistics Current Employment Statistics
9 Ibid
10 Calculations based on Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2014)
11 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
12 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
13 Unemployment numbers are taken from Bureau of Labor
Statistics Current Population Survey
14 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
15 Profit rates are calculated based on data from Board ofGovernors of the Federal Reserve System ldquoZ1 Release--Financial Accounts of the United Statesrdquo (2014) Inflationadjustments are based on the Personal ConsumptionExpenditure Index from Bureau of Economic AnalysisNational Income and Product Accounts
16 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 Release--Financial Accounts of theUnited Statesrdquo
17 Calculations are based on Bureau of the Census IncomePoverty and Health Insurance Coverage in the United States2013
18 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 ReleasemdashFinancial Accounts of theUnited Statesrdquo
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 27
2 Center for American Progress | Economic Snapshot October 2014
1 Economic growth in this recovery lags behind that of previous business cycles
GDP increased in he second quarer o 2014 a an inflaion-adjused annual rae o
46 percen afer conracing 21 percen in he previous quarer Domesic con-
sumpion increased by an annual rae o 25 percen and housing spending rose
subsanially by 88 percen while business invesmen growh also increased a a rae
o 97 percen Expors increased 111 percen in he firs quarer which was offse by
even aser impor growh o 113 percen Governmen spending ell 09 percenTe economy expanded 103 percen rom June 2009 o June 2014991252is slowes
expansion during recoveries o a leas equal lengh
2 Improvements to US competitiveness fall behind previous business cycles
Produciviy growh measured as he increase in inflaion-adjused oupu per hour
is key o increasing living sandards as i means ha workers are geting beter a
doing more in he same amoun o ime Slower produciviy growh hus means ha
new economic resources available o improve living sandards are growing more
slowly han would be he case wih aser produciviy growh US produciviy rose
65 percen rom June 2009 o June 2014 he firs 20 quarers o he economic
recovery since he end o he Grea Recession2 Tis compares o an average o 134
percen during all previous recoveries o a leas equal lengh3 No previous recovery
had lower produciviy growh han he curren one
FIGURE 1
GDP growth in recovery in comparison to previous recoveries
90
120
125
130
115
110
105
100
95
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 201918
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
Source Authorsrsquocalculations based on Bureau of Economic Analysis National Income and Product Accounts (US Department of Commerce 2014)
Calculations only done for recoveries that have lasted at l east four years
Recovery after the Great Recession
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 37
3 Center for American Progress | Economic Snapshot October 2014
3 The housing market recovery still struggles to gain momentum New-home sales
amouned o an annual rae o 467000 in Sepember 2014991252a 17 percen increase
rom he 399000 homes sold in Sepember 2013 bu well below he hisorical average
o 698000 homes sold beore he Grea Recession4 Te median new-home price in
Sepember 2014 was $209700 up rom one year earlier5 Exising-home sales increased
by 24 percen in Sepember 2014 rom one year earlier bu he median price or
exising homes was up by 56 percen during he same period6 Home sales have ogo a lo urher given ha homeownership in he Unied Saes sood a 648 percen
in he firs quarer o 2014 down rom 682 percen beore he 2007 recession Te
curren homeownership raes are similar o hose recorded in 1996 well beore he
mos recen housing bubble sared7
A srong housing-marke recovery can boos
economic growh and here is sill pleny o room or he housing marke o provide
more simulaion o he economy more broadly han i did beore he recen slowdown
4 Moderate labor-market recovery shows less job growth than in previous business
cycles Tere were 85 million more jobs in Sepember 2014 han in June 2009 Te
privae secor added 92 million jobs during his period Te loss o some 562000sae 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 ohers8 Te oal number
o jobs has now grown by 65 percen during his recovery compared o an average
o 129 percen during all prior recoveries o a leas equal lengh9
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 unaffeced
by he aging o he overall populaion991252was 767 percen in Sepember 2014 Tis
was jus above he level recorded in June 2009 and well below he levels recordedsince he mid-1980s and beore he Grea Recession sared in 2007 Te employed
share o he populaion has on average grown by 33 percenage poins a his sage
during previous recoveries o a leas equal lengh10
6 Employers cut back on health and pension benefits Te share o people wih
employer-sponsored healh insurance dropped rom 598 percen in 2007 o 539
percen in 2013 he mos recen year or which daa are available11 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 200712 Families now have less economic
securiy han in he pas due o ewer employmen-based benefis which requires
hem o have more privae savings o make up he difference
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 47
4 Center for American Progress | Economic Snapshot October 2014
7 Some communities continue to struggle disproportionately from unemployment
Te unemploymen rae ell o 59 percen in Augus 2014 Te Arican American
unemploymen rae ell o 11 percen he Hispanic unemploymen rae moved
down o 69 percen and he whie unemploymen rae ell slighly o 53 percen
Meanwhile youh unemploymen increased o 20 percen Te unemploymen rae
or people wihou a high school diploma ell o 84 percen compared wih 53
percen or hose wih a high school degree 54 percen or hose wih some collegeeducaion and 29 percen or hose wih a college degree13 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 a
he 95h percenile991252hose wih incomes o $196000 in 2013 he mos recen year
or which daa are available991252were more han nine imes he incomes o households
in he 20h percenile whose incomes were $20900 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 incomesood a $51939 in 2013 is lowes level in inflaion-adjused dollars since 199514
FIGURE 2
Median household income remains far below pre-recession levels
Median household income 2013 dollars
$40000
$50000
$60000
$45000
$55000
2000 2 001 2002 2 003 2004 2 005 2006 2 007 2008 20102009 2011 2012 2013
Note Shaded bars indicate recessions as defined by the National Bureau of Economic Research
Source US Bureau of the Census Table H-6 Regions by Median and Mean Income available at httpwwwcensusgovhheswwwincome-datahistoricalhousehold (last accessed September 2014)
$51939
$56436
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 57
5 Center for American Progress | Economic Snapshot October 2014
9 Corporate profits stay elevated near pre-crisis peaks Inflaion-adjused corporae
profis were 94 percen larger in June 2014 han in June 2009 Te afer-ax corporae
profi rae991252profis o oal asses991252sood a 32 percen in March 201415 Corporae
profis recovered quickly oward he end o he Grea Recession and have sayed
high since hen Addressing income inequaliy ha arises rom he rich receiving
ousized benefis rom heir wealh hrough ax reorm is a crucial policy prioriy
10 Corporations spend much of their money to keep shareholders happy From
December 2007991252when he Grea Recession sared991252o June 2014 nonfinancial
corporaions spen on average 996 percen o heir afer-ax profis on dividend
payous and share repurchases16 In shor almos all o nonfinancial corporae afer-ax
profis have gone o keeping 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 1666 percen o heir afer-ax profis
on capial expendiures or invesmens991252by selling oher asses and by borrowing
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 highlighing he need or regulaory reorm ha
incenivizes corporaions o inves in research and developmen manuacuring
plans and equipmen and workorce developmen
FIGURE 3
Corporate profits stay elevated near pre-recession peaks
After-tax corporate profit rate
Note Shaded bars indicate recessions as defined by the National Bureau of Economic Research
Source Profit rates are calculated based on data from Board of Governors of the Federal Reserve System ldquoZ1 Release--Financial Accounts of theUnited Statesrdquo (2014) Inflation adjustments are based on the Personal Consumption Expenditure Index from Bureau of Economic Analysis National
Income and Product Accounts
05
10
15
20
25
30
35318
D e c - 2 0 0
0
D e c - 2 0 0
1
D e c - 2 0 0
2
D e c - 2 0 0
3
D e c - 2 0 0
4
D e c - 2 0 0
5
D e c - 2 0 0
6
D e c - 2 0 0
7
D e c - 2 0 0
8
D e c - 2 0 0
9
D e c - 2 0 1
0
D e c - 2 0 1
1
D e c - 2 0 1
2
D e c - 2 0 1
3
J u n - 2 0
1 4
251
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 67
6 Center for American Progress | Economic Snapshot October 2014
11 Poverty is still widespread Te povery rae was 145 percen in 2013 down rom
15 percen in 2012 Tis change however was saisically insignifican Moreover
he povery rae or his recovery increased a a rae o 02 percenage poins compared
o an average decrease o 07 percenage poins in previous recoveries o a leas equal
lengh Some populaion groups suffer rom much higher povery rae han ohers
Te Arican American povery rae or insance was 272 percen and he Hispanic
povery rae was 235 percen while he whie povery rae was 96 percen Tepovery rae or children under age 18 ell o 199 percen More han one-hird o
Arican American children991252377 percen991252lived in povery in 2013 compared wih
304 percen o Hispanic children and 107 percen o whie children17
12 Household debt is still high Household deb equaled 1024 percen o afer-ax
income in June 2014 down rom a peak o 1297 percen in December 200718 A
reurn o deb growh oupacing income growh which was he case prior o he sar
o he Grea Recession in 2007 rom already-high deb levels could evenually slow
economic growh again Tis would be especially rue i ineres raes also rise rom
hisorically low levels due o a change in he Federal Reserversquos policies Consumers would have o pay more or heir deb and hey would have less money available or
consumpion and saving
Chrisian E Weller is a Senior Fellow a he Cener for American Progress and a professor in
he Deparmen of Public Policy and Public Affairs a he McCormack Graduae School of
Policy and Global Sudies a he Universiy of Massachusets Boson Jackie Odum is a
Research Assisan for he Economic Policy eam a he Cener
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 77
7 Center for American Progress | Economic Snapshot October 2014
Endnotes
1 Jenna Levy ldquoIn US Uninsured Rate Holds at 134rdquo GallupOctober 8 2014 available at httpwwwgallupcompoll178100uninsured-rate-holdsaspx
2 Calculations are based on productivity growth (output perhour) for nonfarm businesses from Bureau of LaborStatistics Current Employment Statistics (US Department ofLabor 2014)
3 Ibid
4 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 (USDepartment of Commerce 2014)
5 Ibid
6 National Association of Realtors ldquoExisting-Home SalesSlightly Lose Momentum in August as Investor ActivityDeclinesrdquo Press release September 22 2014
7 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2014)
8 Employment-growth data are calculated based on Bureau
of Labor Statistics Current Employment Statistics
9 Ibid
10 Calculations based on Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2014)
11 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
12 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
13 Unemployment numbers are taken from Bureau of Labor
Statistics Current Population Survey
14 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
15 Profit rates are calculated based on data from Board ofGovernors of the Federal Reserve System ldquoZ1 Release--Financial Accounts of the United Statesrdquo (2014) Inflationadjustments are based on the Personal ConsumptionExpenditure Index from Bureau of Economic AnalysisNational Income and Product Accounts
16 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 Release--Financial Accounts of theUnited Statesrdquo
17 Calculations are based on Bureau of the Census IncomePoverty and Health Insurance Coverage in the United States2013
18 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 ReleasemdashFinancial Accounts of theUnited Statesrdquo
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 37
3 Center for American Progress | Economic Snapshot October 2014
3 The housing market recovery still struggles to gain momentum New-home sales
amouned o an annual rae o 467000 in Sepember 2014991252a 17 percen increase
rom he 399000 homes sold in Sepember 2013 bu well below he hisorical average
o 698000 homes sold beore he Grea Recession4 Te median new-home price in
Sepember 2014 was $209700 up rom one year earlier5 Exising-home sales increased
by 24 percen in Sepember 2014 rom one year earlier bu he median price or
exising homes was up by 56 percen during he same period6 Home sales have ogo a lo urher given ha homeownership in he Unied Saes sood a 648 percen
in he firs quarer o 2014 down rom 682 percen beore he 2007 recession Te
curren homeownership raes are similar o hose recorded in 1996 well beore he
mos recen housing bubble sared7
A srong housing-marke recovery can boos
economic growh and here is sill pleny o room or he housing marke o provide
more simulaion o he economy more broadly han i did beore he recen slowdown
4 Moderate labor-market recovery shows less job growth than in previous business
cycles Tere were 85 million more jobs in Sepember 2014 han in June 2009 Te
privae secor added 92 million jobs during his period Te loss o some 562000sae 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 ohers8 Te oal number
o jobs has now grown by 65 percen during his recovery compared o an average
o 129 percen during all prior recoveries o a leas equal lengh9
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 unaffeced
by he aging o he overall populaion991252was 767 percen in Sepember 2014 Tis
was jus above he level recorded in June 2009 and well below he levels recordedsince he mid-1980s and beore he Grea Recession sared in 2007 Te employed
share o he populaion has on average grown by 33 percenage poins a his sage
during previous recoveries o a leas equal lengh10
6 Employers cut back on health and pension benefits Te share o people wih
employer-sponsored healh insurance dropped rom 598 percen in 2007 o 539
percen in 2013 he mos recen year or which daa are available11 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 200712 Families now have less economic
securiy han in he pas due o ewer employmen-based benefis which requires
hem o have more privae savings o make up he difference
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 47
4 Center for American Progress | Economic Snapshot October 2014
7 Some communities continue to struggle disproportionately from unemployment
Te unemploymen rae ell o 59 percen in Augus 2014 Te Arican American
unemploymen rae ell o 11 percen he Hispanic unemploymen rae moved
down o 69 percen and he whie unemploymen rae ell slighly o 53 percen
Meanwhile youh unemploymen increased o 20 percen Te unemploymen rae
or people wihou a high school diploma ell o 84 percen compared wih 53
percen or hose wih a high school degree 54 percen or hose wih some collegeeducaion and 29 percen or hose wih a college degree13 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 a
he 95h percenile991252hose wih incomes o $196000 in 2013 he mos recen year
or which daa are available991252were more han nine imes he incomes o households
in he 20h percenile whose incomes were $20900 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 incomesood a $51939 in 2013 is lowes level in inflaion-adjused dollars since 199514
FIGURE 2
Median household income remains far below pre-recession levels
Median household income 2013 dollars
$40000
$50000
$60000
$45000
$55000
2000 2 001 2002 2 003 2004 2 005 2006 2 007 2008 20102009 2011 2012 2013
Note Shaded bars indicate recessions as defined by the National Bureau of Economic Research
Source US Bureau of the Census Table H-6 Regions by Median and Mean Income available at httpwwwcensusgovhheswwwincome-datahistoricalhousehold (last accessed September 2014)
$51939
$56436
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 57
5 Center for American Progress | Economic Snapshot October 2014
9 Corporate profits stay elevated near pre-crisis peaks Inflaion-adjused corporae
profis were 94 percen larger in June 2014 han in June 2009 Te afer-ax corporae
profi rae991252profis o oal asses991252sood a 32 percen in March 201415 Corporae
profis recovered quickly oward he end o he Grea Recession and have sayed
high since hen Addressing income inequaliy ha arises rom he rich receiving
ousized benefis rom heir wealh hrough ax reorm is a crucial policy prioriy
10 Corporations spend much of their money to keep shareholders happy From
December 2007991252when he Grea Recession sared991252o June 2014 nonfinancial
corporaions spen on average 996 percen o heir afer-ax profis on dividend
payous and share repurchases16 In shor almos all o nonfinancial corporae afer-ax
profis have gone o keeping 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 1666 percen o heir afer-ax profis
on capial expendiures or invesmens991252by selling oher asses and by borrowing
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 highlighing he need or regulaory reorm ha
incenivizes corporaions o inves in research and developmen manuacuring
plans and equipmen and workorce developmen
FIGURE 3
Corporate profits stay elevated near pre-recession peaks
After-tax corporate profit rate
Note Shaded bars indicate recessions as defined by the National Bureau of Economic Research
Source Profit rates are calculated based on data from Board of Governors of the Federal Reserve System ldquoZ1 Release--Financial Accounts of theUnited Statesrdquo (2014) Inflation adjustments are based on the Personal Consumption Expenditure Index from Bureau of Economic Analysis National
Income and Product Accounts
05
10
15
20
25
30
35318
D e c - 2 0 0
0
D e c - 2 0 0
1
D e c - 2 0 0
2
D e c - 2 0 0
3
D e c - 2 0 0
4
D e c - 2 0 0
5
D e c - 2 0 0
6
D e c - 2 0 0
7
D e c - 2 0 0
8
D e c - 2 0 0
9
D e c - 2 0 1
0
D e c - 2 0 1
1
D e c - 2 0 1
2
D e c - 2 0 1
3
J u n - 2 0
1 4
251
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 67
6 Center for American Progress | Economic Snapshot October 2014
11 Poverty is still widespread Te povery rae was 145 percen in 2013 down rom
15 percen in 2012 Tis change however was saisically insignifican Moreover
he povery rae or his recovery increased a a rae o 02 percenage poins compared
o an average decrease o 07 percenage poins in previous recoveries o a leas equal
lengh Some populaion groups suffer rom much higher povery rae han ohers
Te Arican American povery rae or insance was 272 percen and he Hispanic
povery rae was 235 percen while he whie povery rae was 96 percen Tepovery rae or children under age 18 ell o 199 percen More han one-hird o
Arican American children991252377 percen991252lived in povery in 2013 compared wih
304 percen o Hispanic children and 107 percen o whie children17
12 Household debt is still high Household deb equaled 1024 percen o afer-ax
income in June 2014 down rom a peak o 1297 percen in December 200718 A
reurn o deb growh oupacing income growh which was he case prior o he sar
o he Grea Recession in 2007 rom already-high deb levels could evenually slow
economic growh again Tis would be especially rue i ineres raes also rise rom
hisorically low levels due o a change in he Federal Reserversquos policies Consumers would have o pay more or heir deb and hey would have less money available or
consumpion and saving
Chrisian E Weller is a Senior Fellow a he Cener for American Progress and a professor in
he Deparmen of Public Policy and Public Affairs a he McCormack Graduae School of
Policy and Global Sudies a he Universiy of Massachusets Boson Jackie Odum is a
Research Assisan for he Economic Policy eam a he Cener
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 77
7 Center for American Progress | Economic Snapshot October 2014
Endnotes
1 Jenna Levy ldquoIn US Uninsured Rate Holds at 134rdquo GallupOctober 8 2014 available at httpwwwgallupcompoll178100uninsured-rate-holdsaspx
2 Calculations are based on productivity growth (output perhour) for nonfarm businesses from Bureau of LaborStatistics Current Employment Statistics (US Department ofLabor 2014)
3 Ibid
4 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 (USDepartment of Commerce 2014)
5 Ibid
6 National Association of Realtors ldquoExisting-Home SalesSlightly Lose Momentum in August as Investor ActivityDeclinesrdquo Press release September 22 2014
7 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2014)
8 Employment-growth data are calculated based on Bureau
of Labor Statistics Current Employment Statistics
9 Ibid
10 Calculations based on Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2014)
11 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
12 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
13 Unemployment numbers are taken from Bureau of Labor
Statistics Current Population Survey
14 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
15 Profit rates are calculated based on data from Board ofGovernors of the Federal Reserve System ldquoZ1 Release--Financial Accounts of the United Statesrdquo (2014) Inflationadjustments are based on the Personal ConsumptionExpenditure Index from Bureau of Economic AnalysisNational Income and Product Accounts
16 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 Release--Financial Accounts of theUnited Statesrdquo
17 Calculations are based on Bureau of the Census IncomePoverty and Health Insurance Coverage in the United States2013
18 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 ReleasemdashFinancial Accounts of theUnited Statesrdquo
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 47
4 Center for American Progress | Economic Snapshot October 2014
7 Some communities continue to struggle disproportionately from unemployment
Te unemploymen rae ell o 59 percen in Augus 2014 Te Arican American
unemploymen rae ell o 11 percen he Hispanic unemploymen rae moved
down o 69 percen and he whie unemploymen rae ell slighly o 53 percen
Meanwhile youh unemploymen increased o 20 percen Te unemploymen rae
or people wihou a high school diploma ell o 84 percen compared wih 53
percen or hose wih a high school degree 54 percen or hose wih some collegeeducaion and 29 percen or hose wih a college degree13 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 a
he 95h percenile991252hose wih incomes o $196000 in 2013 he mos recen year
or which daa are available991252were more han nine imes he incomes o households
in he 20h percenile whose incomes were $20900 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 incomesood a $51939 in 2013 is lowes level in inflaion-adjused dollars since 199514
FIGURE 2
Median household income remains far below pre-recession levels
Median household income 2013 dollars
$40000
$50000
$60000
$45000
$55000
2000 2 001 2002 2 003 2004 2 005 2006 2 007 2008 20102009 2011 2012 2013
Note Shaded bars indicate recessions as defined by the National Bureau of Economic Research
Source US Bureau of the Census Table H-6 Regions by Median and Mean Income available at httpwwwcensusgovhheswwwincome-datahistoricalhousehold (last accessed September 2014)
$51939
$56436
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 57
5 Center for American Progress | Economic Snapshot October 2014
9 Corporate profits stay elevated near pre-crisis peaks Inflaion-adjused corporae
profis were 94 percen larger in June 2014 han in June 2009 Te afer-ax corporae
profi rae991252profis o oal asses991252sood a 32 percen in March 201415 Corporae
profis recovered quickly oward he end o he Grea Recession and have sayed
high since hen Addressing income inequaliy ha arises rom he rich receiving
ousized benefis rom heir wealh hrough ax reorm is a crucial policy prioriy
10 Corporations spend much of their money to keep shareholders happy From
December 2007991252when he Grea Recession sared991252o June 2014 nonfinancial
corporaions spen on average 996 percen o heir afer-ax profis on dividend
payous and share repurchases16 In shor almos all o nonfinancial corporae afer-ax
profis have gone o keeping 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 1666 percen o heir afer-ax profis
on capial expendiures or invesmens991252by selling oher asses and by borrowing
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 highlighing he need or regulaory reorm ha
incenivizes corporaions o inves in research and developmen manuacuring
plans and equipmen and workorce developmen
FIGURE 3
Corporate profits stay elevated near pre-recession peaks
After-tax corporate profit rate
Note Shaded bars indicate recessions as defined by the National Bureau of Economic Research
Source Profit rates are calculated based on data from Board of Governors of the Federal Reserve System ldquoZ1 Release--Financial Accounts of theUnited Statesrdquo (2014) Inflation adjustments are based on the Personal Consumption Expenditure Index from Bureau of Economic Analysis National
Income and Product Accounts
05
10
15
20
25
30
35318
D e c - 2 0 0
0
D e c - 2 0 0
1
D e c - 2 0 0
2
D e c - 2 0 0
3
D e c - 2 0 0
4
D e c - 2 0 0
5
D e c - 2 0 0
6
D e c - 2 0 0
7
D e c - 2 0 0
8
D e c - 2 0 0
9
D e c - 2 0 1
0
D e c - 2 0 1
1
D e c - 2 0 1
2
D e c - 2 0 1
3
J u n - 2 0
1 4
251
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 67
6 Center for American Progress | Economic Snapshot October 2014
11 Poverty is still widespread Te povery rae was 145 percen in 2013 down rom
15 percen in 2012 Tis change however was saisically insignifican Moreover
he povery rae or his recovery increased a a rae o 02 percenage poins compared
o an average decrease o 07 percenage poins in previous recoveries o a leas equal
lengh Some populaion groups suffer rom much higher povery rae han ohers
Te Arican American povery rae or insance was 272 percen and he Hispanic
povery rae was 235 percen while he whie povery rae was 96 percen Tepovery rae or children under age 18 ell o 199 percen More han one-hird o
Arican American children991252377 percen991252lived in povery in 2013 compared wih
304 percen o Hispanic children and 107 percen o whie children17
12 Household debt is still high Household deb equaled 1024 percen o afer-ax
income in June 2014 down rom a peak o 1297 percen in December 200718 A
reurn o deb growh oupacing income growh which was he case prior o he sar
o he Grea Recession in 2007 rom already-high deb levels could evenually slow
economic growh again Tis would be especially rue i ineres raes also rise rom
hisorically low levels due o a change in he Federal Reserversquos policies Consumers would have o pay more or heir deb and hey would have less money available or
consumpion and saving
Chrisian E Weller is a Senior Fellow a he Cener for American Progress and a professor in
he Deparmen of Public Policy and Public Affairs a he McCormack Graduae School of
Policy and Global Sudies a he Universiy of Massachusets Boson Jackie Odum is a
Research Assisan for he Economic Policy eam a he Cener
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 77
7 Center for American Progress | Economic Snapshot October 2014
Endnotes
1 Jenna Levy ldquoIn US Uninsured Rate Holds at 134rdquo GallupOctober 8 2014 available at httpwwwgallupcompoll178100uninsured-rate-holdsaspx
2 Calculations are based on productivity growth (output perhour) for nonfarm businesses from Bureau of LaborStatistics Current Employment Statistics (US Department ofLabor 2014)
3 Ibid
4 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 (USDepartment of Commerce 2014)
5 Ibid
6 National Association of Realtors ldquoExisting-Home SalesSlightly Lose Momentum in August as Investor ActivityDeclinesrdquo Press release September 22 2014
7 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2014)
8 Employment-growth data are calculated based on Bureau
of Labor Statistics Current Employment Statistics
9 Ibid
10 Calculations based on Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2014)
11 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
12 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
13 Unemployment numbers are taken from Bureau of Labor
Statistics Current Population Survey
14 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
15 Profit rates are calculated based on data from Board ofGovernors of the Federal Reserve System ldquoZ1 Release--Financial Accounts of the United Statesrdquo (2014) Inflationadjustments are based on the Personal ConsumptionExpenditure Index from Bureau of Economic AnalysisNational Income and Product Accounts
16 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 Release--Financial Accounts of theUnited Statesrdquo
17 Calculations are based on Bureau of the Census IncomePoverty and Health Insurance Coverage in the United States2013
18 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 ReleasemdashFinancial Accounts of theUnited Statesrdquo
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 57
5 Center for American Progress | Economic Snapshot October 2014
9 Corporate profits stay elevated near pre-crisis peaks Inflaion-adjused corporae
profis were 94 percen larger in June 2014 han in June 2009 Te afer-ax corporae
profi rae991252profis o oal asses991252sood a 32 percen in March 201415 Corporae
profis recovered quickly oward he end o he Grea Recession and have sayed
high since hen Addressing income inequaliy ha arises rom he rich receiving
ousized benefis rom heir wealh hrough ax reorm is a crucial policy prioriy
10 Corporations spend much of their money to keep shareholders happy From
December 2007991252when he Grea Recession sared991252o June 2014 nonfinancial
corporaions spen on average 996 percen o heir afer-ax profis on dividend
payous and share repurchases16 In shor almos all o nonfinancial corporae afer-ax
profis have gone o keeping 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 1666 percen o heir afer-ax profis
on capial expendiures or invesmens991252by selling oher asses and by borrowing
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 highlighing he need or regulaory reorm ha
incenivizes corporaions o inves in research and developmen manuacuring
plans and equipmen and workorce developmen
FIGURE 3
Corporate profits stay elevated near pre-recession peaks
After-tax corporate profit rate
Note Shaded bars indicate recessions as defined by the National Bureau of Economic Research
Source Profit rates are calculated based on data from Board of Governors of the Federal Reserve System ldquoZ1 Release--Financial Accounts of theUnited Statesrdquo (2014) Inflation adjustments are based on the Personal Consumption Expenditure Index from Bureau of Economic Analysis National
Income and Product Accounts
05
10
15
20
25
30
35318
D e c - 2 0 0
0
D e c - 2 0 0
1
D e c - 2 0 0
2
D e c - 2 0 0
3
D e c - 2 0 0
4
D e c - 2 0 0
5
D e c - 2 0 0
6
D e c - 2 0 0
7
D e c - 2 0 0
8
D e c - 2 0 0
9
D e c - 2 0 1
0
D e c - 2 0 1
1
D e c - 2 0 1
2
D e c - 2 0 1
3
J u n - 2 0
1 4
251
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 67
6 Center for American Progress | Economic Snapshot October 2014
11 Poverty is still widespread Te povery rae was 145 percen in 2013 down rom
15 percen in 2012 Tis change however was saisically insignifican Moreover
he povery rae or his recovery increased a a rae o 02 percenage poins compared
o an average decrease o 07 percenage poins in previous recoveries o a leas equal
lengh Some populaion groups suffer rom much higher povery rae han ohers
Te Arican American povery rae or insance was 272 percen and he Hispanic
povery rae was 235 percen while he whie povery rae was 96 percen Tepovery rae or children under age 18 ell o 199 percen More han one-hird o
Arican American children991252377 percen991252lived in povery in 2013 compared wih
304 percen o Hispanic children and 107 percen o whie children17
12 Household debt is still high Household deb equaled 1024 percen o afer-ax
income in June 2014 down rom a peak o 1297 percen in December 200718 A
reurn o deb growh oupacing income growh which was he case prior o he sar
o he Grea Recession in 2007 rom already-high deb levels could evenually slow
economic growh again Tis would be especially rue i ineres raes also rise rom
hisorically low levels due o a change in he Federal Reserversquos policies Consumers would have o pay more or heir deb and hey would have less money available or
consumpion and saving
Chrisian E Weller is a Senior Fellow a he Cener for American Progress and a professor in
he Deparmen of Public Policy and Public Affairs a he McCormack Graduae School of
Policy and Global Sudies a he Universiy of Massachusets Boson Jackie Odum is a
Research Assisan for he Economic Policy eam a he Cener
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 77
7 Center for American Progress | Economic Snapshot October 2014
Endnotes
1 Jenna Levy ldquoIn US Uninsured Rate Holds at 134rdquo GallupOctober 8 2014 available at httpwwwgallupcompoll178100uninsured-rate-holdsaspx
2 Calculations are based on productivity growth (output perhour) for nonfarm businesses from Bureau of LaborStatistics Current Employment Statistics (US Department ofLabor 2014)
3 Ibid
4 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 (USDepartment of Commerce 2014)
5 Ibid
6 National Association of Realtors ldquoExisting-Home SalesSlightly Lose Momentum in August as Investor ActivityDeclinesrdquo Press release September 22 2014
7 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2014)
8 Employment-growth data are calculated based on Bureau
of Labor Statistics Current Employment Statistics
9 Ibid
10 Calculations based on Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2014)
11 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
12 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
13 Unemployment numbers are taken from Bureau of Labor
Statistics Current Population Survey
14 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
15 Profit rates are calculated based on data from Board ofGovernors of the Federal Reserve System ldquoZ1 Release--Financial Accounts of the United Statesrdquo (2014) Inflationadjustments are based on the Personal ConsumptionExpenditure Index from Bureau of Economic AnalysisNational Income and Product Accounts
16 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 Release--Financial Accounts of theUnited Statesrdquo
17 Calculations are based on Bureau of the Census IncomePoverty and Health Insurance Coverage in the United States2013
18 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 ReleasemdashFinancial Accounts of theUnited Statesrdquo
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 67
6 Center for American Progress | Economic Snapshot October 2014
11 Poverty is still widespread Te povery rae was 145 percen in 2013 down rom
15 percen in 2012 Tis change however was saisically insignifican Moreover
he povery rae or his recovery increased a a rae o 02 percenage poins compared
o an average decrease o 07 percenage poins in previous recoveries o a leas equal
lengh Some populaion groups suffer rom much higher povery rae han ohers
Te Arican American povery rae or insance was 272 percen and he Hispanic
povery rae was 235 percen while he whie povery rae was 96 percen Tepovery rae or children under age 18 ell o 199 percen More han one-hird o
Arican American children991252377 percen991252lived in povery in 2013 compared wih
304 percen o Hispanic children and 107 percen o whie children17
12 Household debt is still high Household deb equaled 1024 percen o afer-ax
income in June 2014 down rom a peak o 1297 percen in December 200718 A
reurn o deb growh oupacing income growh which was he case prior o he sar
o he Grea Recession in 2007 rom already-high deb levels could evenually slow
economic growh again Tis would be especially rue i ineres raes also rise rom
hisorically low levels due o a change in he Federal Reserversquos policies Consumers would have o pay more or heir deb and hey would have less money available or
consumpion and saving
Chrisian E Weller is a Senior Fellow a he Cener for American Progress and a professor in
he Deparmen of Public Policy and Public Affairs a he McCormack Graduae School of
Policy and Global Sudies a he Universiy of Massachusets Boson Jackie Odum is a
Research Assisan for he Economic Policy eam a he Cener
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 77
7 Center for American Progress | Economic Snapshot October 2014
Endnotes
1 Jenna Levy ldquoIn US Uninsured Rate Holds at 134rdquo GallupOctober 8 2014 available at httpwwwgallupcompoll178100uninsured-rate-holdsaspx
2 Calculations are based on productivity growth (output perhour) for nonfarm businesses from Bureau of LaborStatistics Current Employment Statistics (US Department ofLabor 2014)
3 Ibid
4 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 (USDepartment of Commerce 2014)
5 Ibid
6 National Association of Realtors ldquoExisting-Home SalesSlightly Lose Momentum in August as Investor ActivityDeclinesrdquo Press release September 22 2014
7 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2014)
8 Employment-growth data are calculated based on Bureau
of Labor Statistics Current Employment Statistics
9 Ibid
10 Calculations based on Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2014)
11 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
12 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
13 Unemployment numbers are taken from Bureau of Labor
Statistics Current Population Survey
14 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
15 Profit rates are calculated based on data from Board ofGovernors of the Federal Reserve System ldquoZ1 Release--Financial Accounts of the United Statesrdquo (2014) Inflationadjustments are based on the Personal ConsumptionExpenditure Index from Bureau of Economic AnalysisNational Income and Product Accounts
16 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 Release--Financial Accounts of theUnited Statesrdquo
17 Calculations are based on Bureau of the Census IncomePoverty and Health Insurance Coverage in the United States2013
18 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 ReleasemdashFinancial Accounts of theUnited Statesrdquo
8102019 Economic Snapshot October 2014
httpslidepdfcomreaderfulleconomic-snapshot-october-2014 77
7 Center for American Progress | Economic Snapshot October 2014
Endnotes
1 Jenna Levy ldquoIn US Uninsured Rate Holds at 134rdquo GallupOctober 8 2014 available at httpwwwgallupcompoll178100uninsured-rate-holdsaspx
2 Calculations are based on productivity growth (output perhour) for nonfarm businesses from Bureau of LaborStatistics Current Employment Statistics (US Department ofLabor 2014)
3 Ibid
4 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 (USDepartment of Commerce 2014)
5 Ibid
6 National Association of Realtors ldquoExisting-Home SalesSlightly Lose Momentum in August as Investor ActivityDeclinesrdquo Press release September 22 2014
7 Bureau of the Census Housing Vacancies and Homeowner-ship (US Department of Commerce 2014)
8 Employment-growth data are calculated based on Bureau
of Labor Statistics Current Employment Statistics
9 Ibid
10 Calculations based on Bureau of Labor Statistics CurrentPopulation Survey (US Department of Labor 2014)
11 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
12 Craig Copeland ldquoEmployment-Based Retirement PlanParticipation Geographic Differences and Trends 2012rdquo(Washington Employee Benefit Research Institute 2013)
13 Unemployment numbers are taken from Bureau of Labor
Statistics Current Population Survey
14 Bureau of the Census Income Poverty and Health InsuranceCoverage in the United States 2013
15 Profit rates are calculated based on data from Board ofGovernors of the Federal Reserve System ldquoZ1 Release--Financial Accounts of the United Statesrdquo (2014) Inflationadjustments are based on the Personal ConsumptionExpenditure Index from Bureau of Economic AnalysisNational Income and Product Accounts
16 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 Release--Financial Accounts of theUnited Statesrdquo
17 Calculations are based on Bureau of the Census IncomePoverty and Health Insurance Coverage in the United States2013
18 Calculations are based on Board of Governors of the FederalReserve System ldquoZ1 ReleasemdashFinancial Accounts of theUnited Statesrdquo