Tuesday, September 2, 2014

"The Nation's Economy, This Side of the Recession"
By Alicia Parlapiano, Shaila Dewan, and Nelson D. Schwartz. June 14, 2014
http://www.nytimes.com/interactive/2014/06/14/business/this-side-of-the-recession.html?ref=economy

The authors of this article give a broad overview of the macroeconomic state of the nation today, five years after the United States began to recover from the recession. Their primary focus is the job market and how it has evolved since before the recession. Not all industries fared the same through recession and recovery. Though the number of jobs in the market is now the same as the "previous peak of January 2008" (Parlapiano, Dewan, and Schwartz), we are still facing high unemployment as the many new workers have entered the labor market since that time. There are also millions of long term unemployed people, due to the weak recovery. This has kept down wages and the labor force participation rate has decreased since 2007. The article estimates that the nation is "at least seven million jobs below it's potential" and thus we are losing a large amount of money on output.

Many middle class industries suffered the most during the recession, and recovery has been weak in fields like construction and manufacturing. The manufacturing production index is back near the level it was at prior to the recession. Despite the loss of jobs, we are producing nearly the same amount indicating greater "efficiency and high productivity." This has both positive and negative macroeconomic effects. The economy has lost about 2.5 million middle-wage jobs and there are fewer factories. Poor and  low-wage workers have not recovered nearly as much as the richer members of the country. The number of people receiving food stamps has almost doubled since 2007, median yearly income has decreased by more than $4000, and "the nation's poverty rate remains above its pre-recession level."

Conversely, health care, energy, and technology industries have recovered quite well since the recession and even grown. Approximately 1.5 million jobs have been added by health care services at various wage levels. Certain states like Texas and North Dakota have recovered better than others thanks to new technologies that have increased the output of oil and natural gas. The technology industry suffered little during the recession and have "emerged as prime drivers of the economy, creating tremendous wealth for a number of individuals and adding many well paying jobs." I really like this article because it presents facts on several different facets and helps paint the macroeconomic picture of today. Also, the use of graphs and other visuals greatly aides in understanding the complex nature of our overall economy.



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