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The Economic Recovery 2010-19: What Changed and What Didn’t – Part 1: Overview

Before the onset of the coronavirus, the United States enjoyed its longest period of economic growth in history – beginning in 2010 and ending in 2020. During that period some things stayed the same, and some things didn’t. This blog series will take a look at what happened to some key economic factors over that period. But first, a quick review on the economic recovery of the last decade.

Following the financial crisis and recessions of 2008 and 2009, the economy began to recover in 2010. A fiscal stimulus, improving credit conditions, temporarily reduced social security taxes (2011 and 2012), record low interest rates, and a calming of the financial markets all contributed to the turnaround. The graph below shows the unemployment rate over the past decade. After peaking at approximately 10% in October 2009 the unemployment rate took a long, gradual decline until the spike in early 2020. In 2018 the unemployment rate dipped below 4%, which had not occurred since 1970. The 2018 tax cuts contributed to the continuation of a relatively long period of economic growth but also contributed to growing federal deficits in a period of economic expansion.

Unemployment Rate (16 yrs. and older)

Source: U.S. Bureau of Labor Statistics

Mirroring the declining unemployment rate was GDP growth. Economic growth was by no means stellar; it was a prolonged period of steady growth, with annual growth never exceeding 3.0% during the recent recovery. In the economic recovery of 1992–2000, economic growth exceeded 3.0% in 7 out of 9 years and was 4.0% or greater in 5 years. In the economic recovery after 2001, economic growth exceeded 3.0% in 2004 and 2005.

GDP Change

According to the National Bureau of Economic Research the recent economic recovery was the longest in history and reached 128 months in February 2020 before coming to a screeching halt. The longest economic recovery in history – what changed other than unemployment and economic growth? We’ll discuss the impact of the economic recovery on a few select variables next.

For further information:

  • Unemployment Rate Data from the Bureau of Labor Statistics: Bureau of Labor Statistics
  • GDP Growth (and other national data) from the Bureau of Economic Analysis: GDP Growth
  • Info on Economic cycles from the National Bureau of Economic Research: Economic Cycles

CBEI Series: The Economic Recovery 2010-19: What Changed and What Didn’t
Part 1: Overview
Part 2: Wealth Distribution
Part 3: Manufacturing Employment
Part 4: Trade with China … and the Rise of Vietnam
Part 5: Funding the U.S. Government – Corporate vs. Individual Taxes
Part 6: Corporate Debt and Collateralized Loan Obligations

Kevin Bahr

Prof. Kevin Bahr, Ph.D. is the chief analyst of the Center for Business and Economic Insight at the University of Wisconsin-Stevens Point School of Business and Economics. Follow his blog for the latest news from CBEI.

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