The “Jobless and Wageless” Recovery from the Great Recession of 2007-2009: The Magnitude and Sources of Economic Growth Through 2011 and Their Impacts on Workers, Profits, and Stock Values

Source: Andrew Sum, Ishwar Khatiwada, Joseph McLaughlin, Sheila Palma, Center for Labor Market Studies Northeastern University, May 2011

…The Great Recession of 2007-2009 was characterized by a massive decline in private sector wage and salary jobs, rapidly rising unemployment and underemployment, and steep increases in the median and mean durations of unemployment…..While aggregate real output has increased modestly since the end of the Great Recession and employment has finally began to increase since early 2010, there are key questions about the sources of economic growth in the recovery and the beneficiaries of that growth in terms of jobs, incomes, wages, and profits, that need to be answered. This research paper is designed to answer these questions and to provide findings on a new set of national economic indices that will provide evidence on the impacts of the economic recovery through 2011 I on aggregate employment, real hourly and weekly wages, corporate profits, and the values of several leading stock indices….The only major beneficiaries of the recovery have been corporate profits and the stock market and its shareholders. Most holders of savings and money market accounts also are net losers due to declining real interest rates which have been in negative territory for many interest bearing and money market accounts.

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