Below Trend: The U.S. Productivity Slowdown Since the Great Recession
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In the span of just six quarters between 2007 and 2009, nonfarm business output declined by $753 billion and 8.1 million jobs were lost. This period, known as the Great Recession, was the worst American recession since the Great Depression. The U.S. economy has been recovering from this historic decline for 7 years and is now in the midst of the one of the longest business cycles of the post–World War II (WWII) era. At this point, there are enough data for us to see how this business cycle is shaping up compared with past cycles, and we may ask, “How well, exactly, are we doing?” and “How much have we recovered, up to this point in this cycle?” The productivity measures published by the Bureau of Labor Statistics (BLS) are very useful in addressing these questions, because they make connections between important economic indicators, including output, employment, labor hours, worker compensation, and inflation. With regard to labor productivity itself, it has become clear that the United States is in one of its slowest-growth periods since the end of WWII. This issue of Beyond the Numbers analyzes the historically slow U.S. labor productivity growth observed during the current business cycle and addresses the implications for the U.S. economy.
labor productivity growth; Great Recession; business cycle; slowdown