How Are We Doing? 5 Conflicting Facts About America’s Economy Today
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The Great Recession is over, that much is clear based both on statistics (GDP, jobs added and other metrics) and by the general mood of the populace. But the boom times have certainly not returned. Rather, American businesses and citizens of the day seem caught between a readiness to rocket back into a cycle of spending and growth and a hesitation to invest or purchase based on a risk-averse culture fostered by the last few years. A nearly stagnant federal government does little to boost morale and confidence, so it is going to be up to the private sector to usher in a true return to prosperity.
5 Home Sales Surged in October
One of the biggest drivers of economic growth is the housing market. (That same market is quite adept at ruining the economy, of course, when it collapses.) When people are buying houses, it invariably leads to buying all sorts of other things, from grass seed and fertilizer to appliances and insurance. October saw a dramatic 25% increase in the number of homes sold compared to the month preceding it. This greater volume essentially revived the trend toward more robust sales we have seen over the course of many months, and has the housing market on track to be back near its all-time highest volume by 2017.
4 Analysts Predict a 3% Rise in GDP Next Year
If a handful of economists and business analysts are correct, 2014 could finally see the American Gross Domestic Product rise by 3%. That figure would be a sure sign of a revived, robust economy, one in which investment was secure and growth probable. Even after the technical end of the recession (meaning the economy was considered to be growing, rather than stagnant or contracting), growth has been frustratingly slow for the past few years. The end of that trend would be welcome news.
3 Holiday Spending Has Been a Disappointment
Despite all the signs pointing to a revived economy, the holiday shopping season has gotten off to a poor start. According to the National Retail Federation, on average, shoppers spent about $25 less between Thanksgiving Day and the Sunday that followed. That might seem like a minute drop, but when multiplied by the millions upon millions of Americans who did the bulk of their holiday shopping on those days, it represents a precipitous drop in spending. And keep in mind that many stores and companies see the majority of their annual sales during the holidays.
2 The Government’s Approval Rating is Abysmal
When the people lack confidence in their government, they lack confidence in their country as a whole, which can lead to economic decline and stagnation. And right now, people strongly disapprove of the government. Mr. Obama’s approval rating stands at around 42%, which is far from ideal but not far from the average for the early part of a second presidential term. And the president is doing head and shoulders better than congress: an averaging of multiple surveys (ranging from polls by FOX, The Economist, CNN, etc.) puts that body’s approval rating at a horrid 9.1%.
1 Jobs in the Private Sector Surged in November
According to data from payroll giant ADP, the private sector added some 215,000 jobs in November. That is the largest increase in more than a year, and shattered analysts’ expectations by more than 40,000 jobs. The surest sign that the economy is doing well is a healthy, hiring private sector; now all we need is for those numerous employed workers to take some of the money they earn and go out to spend it.