From household wealth to spending at stores, many of the U.S. economy’s vital signs have recovered from the damage done by the Great Recession.
Home foreclosures and layoffs have dropped to pre-recession levels. Economic output has rebounded. And the Dow Jones industrial average is in record territory.
So is the economy back to full health? Not quite.
Not with unemployment at 7.7 percent and with 3 million fewer jobs than when the recession began. And while the housing market is improving, that engine of economic growth and job creation still has far to go before it can be declared healthy.
Perhaps the best way to think about the U.S. economy is this: After five painful years, it’s nearly back to where it started when the recession began. What’s different now is that the trends are much healthier. Gone are the fears that the economy could fall into another recession.
Here’s a look at ways in which the economy has returned to pre-recession levels and ways it hasn’t:
WHAT’S BACK:
• HOUSEHOLD WEALTH: Americans lost $16 trillion in wealth during the recession, mainly because home values and stock prices sank. Those losses have now been reversed. Household “net worth” reached $66.1 trillion in the final three months of 2012, according to the Federal Reserve. Net worth equals the value of homes, investments, bank accounts and other assets, minus debts such as mortgages, student loans and credit card balances.
• RETAIL SALES. Retail sales totaled $421.4 billion in February. Adjusted for inflation, that was nearly 18 percent above the recession low and just 0.7 percent below the record level in November 2007.
• LAYOFFS. The job market remains weak by some measures. But consider this: If you have a job, you’re less likely to lose it than at any other point in at least 12 years.
WHAT’S NOT BACK:
• TOTAL JOBS. The United States still has many fewer jobs than in December 2007. The recession eliminated 8.7 million. Since then, 5.7 million jobs have come back, leaving the economy 3 million short.
• UNEMPLOYMENT RATE. When the recession began, unemployment was 5 percent. Now, it’s 7.7 percent. Probably no figure better illustrates the downturn’s lingering damage.