The current state of the US economy in one chart

9/6/2014

The chart above helps explain the current state of the US economy:

1. Measured by the output of real goods and services, the US economy has made a full and robust recovery from the Great Recession, and we are now producing 7.65% more output in Q3 (based on the Atlanta Fed’s GDPNow forecast of 3.6% for real GDP growth in Q3) than in the fourth quarter of 2007. In inflation-adjusted dollar terms, the US economy today is $1.14 trillion larger than in Q4 2007 (in 2009 dollars).

2. From the peak level of civilian employment of 146,595,000 jobs in November 2007, the US employment level in August of 146,368,000 is still 227,000 jobs below that pre-recession peak.

Bottom Line: The US has been producing new record-high levels of GDP in almost every quarter since Q3 2011, and we are now producing 7.65% (and $1.14 trillion) more real GDP today than in late 2007. But we are producing that record-setting level of real output with a quarter-million fewer workers than in 2007. One explanation for America’s record-high output with 227,000 fewer workers is that the Great Recession facilitated what might be one of the greatest expansions of worker productivity in US history. The fact that we’ve been able to greatly expand national output with fewer inputs (workers) represents a huge increase in economic efficiency, but has also left us with a lingering “jobless recovery” and an economy that is struggling to create new, post-recession employment opportunities for millions of Americans.

source