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> Window On The Economy, August 2009The past looks worse, does the future look better? In this month's edition we take a look at two topics. First, comprehensive revisions to the GDP data show that the "Great Recession" was greater than previously believed. Aside from a downgrading of real GDP during 2008 and Q1 2009, the revised data also show a significantly deeper decline in aggregate wage and salary earnings over 2009's first half than was initially reported. This weaker path of labor earnings means consumers will face an even rockier road over coming months as transitory supports to disposable income fade, which is consistent with our outlook that restrained growth in consumer spending will set the stage for a tepid recovery. In addition, we also look at the growing problem of long-term unemployment in the U.S. economy, fostered in part by what has been a high degree of structural unemployment during the recession. This structural unemployment is one reason why the unemployment rate is likely to remain elevated for some time even after the Great Recession has run its course. © Mission Residential. All rights reserved.
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