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Recovery on track, but still slow and steady

“The job market picked up more than expected in February, led by strong hiring in professional and business services.”

The U.S. economy added 175,000 jobs last month, making a significant improvement from January. Meanwhile (as Devin mentions in his unemployment post), the unemployment rate rose from 6.6% to 6.7 %, as more Americans joined the labor force. This is not what many economists predicted. Economists had been expecting a weaker jobs number due to colder than usual weather throughout much of the country in February. However, according to CNN Money, “construction added 15,000 jobs, restaurants and bars added 20,100 jobs and education and health services added 33,000 jobs.”

But, there is an argument that “it’s all relative.” Their argument is that the government’s jobs report looked great only because economists had been forecasting weaker numbers due to harsh winter weather. “Fundamentally, the economy has not changed – we’re just having to absorb an unusually severe winter,” said Dean Maki, chief U.S. economist for Barclays.

Now, Experts are optimistic about the recovery (after this harsh winter). New York Fed President Bill Dudley said he believes that the economy will bounce back after the harsh winter because the drag from federal spending cuts is declining and household finances are improving. General Motors also hopes for the strongest GDP growth since the end of the recession. Home Depot also agrees with the idea, believing a moderate housing recovery will continue.

However, while the growth rate (Dudley predicts 3% growth) is solid, it is too slow for many Americans. Many Americans (about 3.8 million) workers have been unemployed for more than six months. There are also discouraged workers that we do not consider in unemployment rate. While it is true that our economy is recovering, it is still slow to help the people.

CNN Money


  1. kuveke kuveke

    I think having realistic expectations of what we can expect the economy to do is important. As the Professor mentioned in class we end up expecting GDP growth to be roughly stable so when exogenous shocks effect the economy it is difficult to expect the growth rate to simply change to put the GDP back to its original level. Rather we now have to forecast future economic growth based on the new size of the economy. As growth improves its better to focus on the current situation and how we can continue to improve the situation rather then lamenting on what has been lost.

  2. christycui christycui

    Too slow for Americans? More growth means less employment? Not always… Even if so, what do we have to boost the economy? If it’s technology, then the opposite might just occur – a decrease in job demand. I agree with paul that we need to have realistic expectations.

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