Xinhua, Washington
Several US economic indicators improved in 2013, but millions of Americans remain jobless after the end of the worst economic downturn in decades.
Americans’ confidence in the US economy saw a boost in 2013, with May and June marking the two best months since 2008, according to a Gallup report released Thursday.
U.S. consumer spending-the driving force of the world’s largest economy-reached its highest level since 2008, with Americans reporting a jump in their daily spending to 88 U.S. dollars in 2013, up 16 U.S. dollars from 2012.
Job creation also improved last year, with 36 percent of workers reporting that their employer was hiring, while 16 percent said their employer was letting workers go, Gallup found.
Around 10 million Americans remain jobless four-and-a-half years after the downturn, and the unemployment rate shows little sign of recovering anytime soon.
“The problem is not unwillingness to hire. It is a lack of aggregated demand and production,” Brookings Institution Senior Fellow and former presidential advisor Barry Bosworth told Xinhua.
Economic Policy Institute labor economist Heidi Shierholz wrote in a report last week that jobs have seen “agonizingly slow progress toward full recovery.”
The total “jobs gap”-the number of jobs needed to return the U.S. economy to pre- recession health-is 7.9 million jobs, Shierholz said.
The pace of the job recovery has not accelerated significantly since 2011 when on average, the labor market added 175,000 jobs per month. In 2012, that figure was 183,000 jobs per month.
During the period from December 2012 to November 2013, for which data is available, the labor market added 191,000 jobs per month, and from September 2013 to November 2013 the labor market added 193,000 jobs per month, Shierholz noted.
“At 200,000 jobs per month, pre-recession labor market conditions would not be regained for another five years,” she argued. “To regain pre-recession labor market conditions in two years, we would need to add 400,000 jobs per month.”
Bosworth believed that the situation will gradually get better as the housing market cures itself and the most severe period of fiscal restraint by the federal government seems to be over, “unless the Republicans win control of the Congress in the fall.”
“But proposals such as that of (former Treasury Secretary and White House advisor) Larry Summers for a round of demand stimulus- infrastructure have attracted no support. The fiscal position of the states seems to have stabilized, and will be a small positive going forward. However, the Federal Reserve also seem less committed to future stimulus,” Bosworth said.
“The economy is being left to fix itself. And there are no more easy policy proposals from the public sector,” he said.
