Recession ends but economic fears continue

September 20, 2010 7:26:03 PM PDT
It may not feel like it, but the longest recession in 70 years is over. The National Bureau of Economic Research, a panel of academic economists, announced on Monday that the recession officially lasted 18 months.

It started in December 2007 and ended in June 2009. The economy lost more than 7 million jobs during that time making it the biggest job loss since World War II.

However, there are only a few that believe the good times are just around the corner.

The recession may be long gone on paper, but on the street, a lot of people aren't buying it.

"I think that's crazy talk. I mean you have to be on drugs to believe that," said San Jose resident Doug Johnson.

The academic committee which concluded the recession ended 14 months ago analyzed a number of indicators from gross domestic product and income to employment.

Michael Boskin, Ph.D., is a senior fellow at Stanford's Hoover Institution, former chair of the Council of Economic Advisors for President H.W. Bush, and member of the National Bureau of Economic Research which issued the report.

"When economists talk about a recession ending, they mean the economy has stopped shrinking and started to grow. It doesn't mean we are anywhere back to normal or back to good times or we'll be doing better anytime soon," said Boskin.

Boskin predicts growth during this recovery will tick along at a painfully slow rate of two percent. The biggest challenge is that job creation is lagging and with unemployment hovering around 10 percent, competition for the few jobs out there, is fierce.

"I heard that you need to apply for 30 jobs to get one call back and you need three call backs to get an interview," said Don Alves.

At Magpie Home and Gift Boutique in San Jose's Willow Glen neighborhood, there is optimism going into the holiday shopping season. Vicki Stewart, from the boutique, says she has seen evidence of a slow recovery.

"You know it's an exciting time to know that the holiday's are going to be better and all looking for it to be better and people coming in and walking around and feeling good about shopping again," said Stewart.

But for many until the housing market and job market improve significantly, the recession that has technically over doesn't feel over.


Load Comments