The decade of recession

Numbers fly around like bats in the attic when economists try to explain to us why a recession they claim ended in June 2009 feels like it is still hanging on.

Economic indicators. Corporate earnings reports. Gross domestic product. The relative strength or weakness of the dollar. Import-export imbalances. Jobless claims. Jobs created. Housing starts. Commercial vacancy rates. Consumer confidence. Savings rates and the percent of our income that goes to paying finance charges.

The only number we might actually recognize is the Dow Jones Industrial Average, which climbed above 11,000 last week for the first time in a long while. But then we are told that the stock market is more a measure of corporate optimism than it is of economic health, and we shouldn't pay it that much attention.

It was not until a pair of New York Times reporters put some new numbers out there that the depth and enduring nature of this recession made any sense to me.

It looks like it is going to take more than a decade to get back to where we were, according to their reporting. And that's if everything goes well. The economic speed bumps we are bound to hit, because the economy is so weak and vulnerable, mean it is likely to take longer than that.

Ugh.

I was willing to hold my breath for a year or two, suck in my stomach and tighten my belt until this unpleasantness passed. But a decade? More than a decade? Whether you are 20 or 60, 10 years seems like forever.

According to the reporting of Michael Powell and Motoko Rich in the Times, unemployment rates have come down from their peak in some parts of the country — and employers are even adding about 68,000 jobs a month.

But at that rate, the country would need nine years to recover the jobs it lost to the recession, and that does not include the millions of jobs needed for those entering the work force over that time.

Median housing prices have dropped 20 percent since 2005, and it will take about 13 years to get back to their peak. Meanwhile, foreclosures and delinquencies have so crippled the housing market that even those homeowners not in trouble can't seem to sell their homes, and some will ultimately settle for less than what they paid.

Housing experts, the Times reported, expect it will take 10 to 15 years before we are selling homes again at an annual rate of more than 8 million. That's double what we are selling today.

Those of us still employed have seen our hours cut — while our living expenses have stayed the same or increased. Or we have seen our co-workers laid off and their workload shifted to us without any increase in compensation. Employers are rightfully uneasy about hiring or expanding, but I suspect they are counting on the servile gratitude of those who still have jobs.

Unemployment will continue to be stubbornly high, we are told, not just because employers are skittish but because many industries — newspapers included — are not expected to recover and those workers need the time to learn new skills.

So, if it still feels like a recession to you, there is good reason.

Harvard economist Jeffrey Frankel explains that economists are simply saying that, beginning in June 2009, things stopped getting worse.

"It is not a statement that we are back to good times," he writes in a Times blog. "It takes a long time to emerge fully from a hole that deep."

And we are just now learning what "a long time" may mean.

Susan Reimer's column appears Mondays. Her e-mail is susan.reimer@baltsun.com.

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