Yes, We Are Recovering, There Are Jobs

I can confirm that we are on your path to recovery by looking at the data revealed by BLS – employment up in March. However, is it possible to say ‘this is the end of recession’ just by looking at the employment trend?

Improvement in an economy is marked by two important things – employment and output, which are moving not quite as required, but yes, they are positive. Experts argue, these two factors too are cannot determine the improvement in the economy. During the recovery phase back in Nov 2001, the output trend performed much better than employment curve. If people would have depended on employment data, recession would have lasted till Nov 2004. But if you have looked at the GDP then, you would wonder if there was any recession at all.

This time, however, the dilemma is not so intricate. GDP has risen and so has the economy rate (though a bit), which can be a strong indicator of a recovery. The reason it always lags behind is because companies hire employees only after they are sure the recession is over. Nevertheless, the lag is not long this year.

Our job market started showing positive signs by June 2009. Though it wasn’t steady since then, it can be said that the improvement this month is drastic and here to stay. I can say this confidently because recovery means increasing economic activity, and not economic activity at its peak.

Meanwhile, the GDP is increasing steadily. Though there are some errors in the statistics, it’s positive. Statistical errors? Yes, the total income for the year should equal the total production of the country. There is, however, a large gap with less production and more income. Let’s hope there isn’t any such gap in the recent employment data.