Forum Post: This Recovery is Killing Us

Let me see if I’ve got this straight…

The Great Recession, or whatever we’re calling it, began in December 2007. And we found that out when the National Bureau of Economic Research (“NBER”) announced it on November 28, 2008.

Okay, so the Great Recession ended as of June 2009. And we were told that by the NBER on September 20, 2010.

Now, a new study just released yesterday by Sentier Research, a firm founded by two former Census Bureau officials, shows that during the Great Recession real median household income fell by 3.2%.

The interesting thing about the study is that the study also shows that since the Great Recession officially ended real median household income fell by an additional 6.7%, which means it dropped from the $53,518 down to $49,909.

Wow… that kinda’ makes you long for the good old days of the Great Recession, doesn’t it?

Want to know what else you can draw from those numbers? Well, since December of 2007, real median household income dropped by 9.8%... that’s a TEN PERCENT DROP in the median household income in this country.

And don’t get bummed out about this study, because a few years from now the NBER is probably going to refer to today as having been a peak.

Now, there’s another study that just came out courtesy of Henry S. Farber of Princeton University. It’s titled: Job Loss in the Great Recession, and it’s a page- turner, let me tell you. Among numerous other distressing things, Farber’s study found that the folks that lost their jobs during the Great Recession and were lucky to find work again, on average earned 17.5% less than they did in their old jobs.

You see, that whole finding work thing is really getting to be kind of a long haul. According to the Bureau of Labor Statistics, on average, if you lost your job in December of 2007… you know, when the Great Recession began, it took you 16.6 weeks to find a new job. … that’s 4-5 months.

When the Great Recession ended in June of 2009, if you lost your job it took you 24.1 weeks on average to find work… about six months. But since the Great Recession ended… and we’ve been “recovering” for what, about two and a half years since then… as of September of 2011… if you lose your job, it takes an average of 40.5 weeks, or roughly 10 months to find that new lower paying one.

I don’t want to speak for everyone, but I’m not sure we can take much more of this recovering. If we recover much more, the average person who loses a job will be out of work over a year! And since 2008, we’ve got 6.5 million officially unemployed for over six months, and a few million more that we’ve stopped counting because they’re no longer even looking for work, referring to them as having “dropped out of the labor force.”

The American auto industry, assuming its sales for the first half of this year hold up throughout the second half, which I would tell you is impossible, is on pace to sell just about 30% fewer new cars this year than it did a decade ago.

And if that statistic didn’t bother you enough, then tell me when ten years ago was, genius… 2001… you remember 2001, don’t you? That was the year that we spent in a deepening recession, reeling from the trillions in consumer wealth lost as a result of the dot-com bubble’s demise. Ahhh, 2001… an absolutely horrendous year for the economy, that is to say until things really went south after 9-11. And this year, if we’re impossibly lucky, we’ll sell 30% fewer new cars than back then?

The Federal Reserve Bank of New York recently published a report on discretionary service spending, which is how much we spend after you deduct housing, food and health care. Such spending has NEVER fallen more than three percent during a recession, even going back decades… except during this “recovery” it’s already down by seven percent.

At least you’ll be relieved to hear that bonuses on The Street are on track to at least equal the egregious, if not unconscionable… no, how about kingly sums paid out last year… I just read it in the WSJ. So, very well done there.

Now close your eyes, and imagine all of the numbers being two years worse… and the organizers are planning to take to the streets. Only it’s two years from today and now they’re expecting a crowd of at least 300,000. The police continue to use force to suppress the people.

What do you see? What do the video clips of Occupy Boston or Occupy Wall Street look like then… two years from now, when everything is that much worse?

This is the time to stand together and say no more.

Mandelman out.