by Bill McBride on 8/05/2012 09:40:00 AM
Sunday, August 05, 2012
Here is an update to four key indicators used by the NBER for business cycle dating: GDP, Employment, Industrial production and real personal income less transfer payments.
Note: The following graphs are all constructed as a percent of the peak in each indicator. This shows when the indicator has bottomed - and when the indicator has returned to the level of the previous peak. If the indicator is at a new peak, the value is 100%.
These graphs show that several major indicators are still significantly below the pre-recession peaks.
Click on graph for larger image.
This graph is for real GDP through Q2 2012. Real GDP returned to the pre-recession peak in Q4 2011, and has been at new post-recession highs for three consecutive quarters.
At the worst point - in Q2 2009 - real GDP was off 4.7% from the 2007 peak.
Real GDP has performed better than other indicators ...
This graph shows real personal income less transfer payments as a percent of the previous peak through the June report.
This measure was off 11.2% at the trough in October 2009.
Real personal income less transfer payments are still 3.0% below the previous peak.
The third graph is for industrial production through June.
Industrial production was off over 17% at the trough in June 2009, and has been one of the stronger performing sectors during the recovery.
However industrial production is still 3.3% below the pre-recession peak.
The final graph is for employment. This is similar to the graph I post every month comparing percent payroll jobs lost in several recessions.
Payroll employment is still 3.5% below the pre-recession peak.
All of these indicators collapsed in 2008 and early 2009, and only real GDP is back to the pre-recession peak. At the current pace of improvement, industrial production will be back to the pre-recession peak in early 2013, personal income less transfer payments late in 2013, and employment in late 2014.