It may look that way because of some improvements in specific areas of the economy, but the Great Recession never truly ended for millions of Americans. Households across the nation are still trying to overcome a sluggish labor market, stagnant wages, and rising living costs. Although technically ended in 2009, the struggle does not appear to be ending anytime soon.
According to a new report from the U.S. Census Bureau, millions of households are grappling with the financial crisis. Real median household income in 2012 totaled $51,017, down slightly from $51,100 in 2011. Incomes have now declined for three consecutive years, and remain 8.3 percent below 2007 levels, the year before the nation entered the worst financial downturn since the Great Depression. Furthermore, the nation’s official poverty rate last year was 15 percent, representing 46.5 million people living at or below the poverty line. That is 2.5 percent higher than in 2007.
The Federal Reserve's wealth effect is in short supply. According to a survey that polled more than 4,100 respondents between September and October last year, 25% of American households say their families are "just getting by" financially, and another 13% are "finding it difficult to get by." Compared to five years earlier, 34% feel like they are worse off today. A mere 30% reported that they were somewhat or much better off financially.
"Many households in the United States have been tested by the Great Recession. Large-scale financial strain at the household level ultimately fed into broader economic challenges for the country, and the completion of the national recovery will ultimately be, in part, a reflection of the well-being of house- holds and consumers," the survey indicated.
Unemployment
Despite a rebound in the stock market, the employment situation in America remains weak. Employers added 169,000 jobs in August and the unemployment rate continued to decline. The bigger picture is worrying, however.
Last month’s headline unemployment rate declined to 7.3 percent, its best level since December 2008. That is below the peak of 10 percent in 2009, but the rate has now remained above 7 percent for 57 consecutive months.
In addition, the U-6 unemployment rate, which includes everyone in the headline rate as well as people who are employed part-time but prefer a full-time position, or want work but have stopped looking , remains obstinately high at 13.7 percent.