Economic Recovery Is Slow Compared to Other Recessions, Here’s Why
There has been plenty of positive news on the economic front lately. It took roughly six years for the economy to finally pick up steam, and it was just last month that the employment rate finally returned to pre-recession levels. For most people, the past six years have been tough, and extremely tough for millions who were already struggling to make ends meet. Millions of jobs disappeared, and although the numbers show they have returned, many are more in-line with what could be called a ‘McJob,’ rather than a position that can sustain a family or lead to financial prosperity.
For those struggling to get by, the recovery over the past half-decade has seemingly taken an eternity. The thing is, those people wondering what the hold has been are right in one aspect: this recovery has taken substantially longer than in previous recessions. There are several factors at play, and it seems true to many that while things have returned to pre-recession levels on paper, the feeling in much of the country doesn’t feel like things are any better.
The Organisation for Economic Co-operation and Development detailed some of the factors behind the slow ascent back to economic normalcy in a recent report, profiling some of the macroeconomic and financial challenges still facing many Americans. They do lay out some facts — like job numbers going up and consumer confidence rising — but it is also clear that there are aspects at play that are clearly holding things back.
“This is not a ‘business-as usual’ recovery. The economic rebound has been weaker than after past recessions, not only because of the lingering effects of the financial turmoil but also due to unusually large cut-backs in public spending, including government employment, and the long-expected retirement of baby boomers,” the report says.
Essentially, a combination of low wages, regressive tax structures, and failing social safety nets haven’t given people the traction to climb the economic ladder. Cost increases in education and cost of living have also played a role. Loss of jobs to overseas markets and jobs that were cut haven’t returned, or came back at much lower pay and hours.