Sunday, October 30, 2011

Recovery Measures

by Calculated Risk on 10/30/2011 05:33:00 PM

By request, 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 most major indicators are still way below the pre-recession peaks.

GDP Percent Previous PeakClick on graph for larger image.

This graph is for real GDP through Q3 2011 and shows real GDP is finally back to the pre-recession peak. Gross Domestic Income (not shown) returned to the pre-recession peak in Q2 - GDI for Q3 will be released with the 2nd estimate of GDP. (For a discussion of GDI, see here).

At the worst point, real GDP was off 5.1% from the 2007 peak. Real GDI was off 5.7% at the trough.

Personal Income less TransferAnd 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 September.

This measure was off almost 11% at the trough!

Real personal income less transfer payments is still 5.3% below the previous peak and has declined over the last three months.

Industrial Production This graph is for industrial production through September.

Industrial production had been one of the stronger performing sectors because of inventory restocking and some growth in exports.

However industrial production is still 6.5% below the pre-recession peak, and it will probably be some time before industrial production returns to pre-recession levels.

Employment 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 4.8% below the pre-recession peak.

This shows that the recovery in all indicators has been very sluggish compared to recent recessions.

Yesterday:
Summary for Week ending Oct 28th
Schedule for Week of Oct 30th