The United States economy recovered.

So I was arguing with Jamie Kenny about Obama’s economic record.

It was Friday night, so I had no inclination whatsoever to do economics. Anyway, I got around to it.

fredgraph

The top, blue line is the civilian unemployment rate in %, on the left scale. The next, red line is average weekly wages, on the right scale. The next, orange line is the average hourly wages for nonsupervisory, production employees, seasonally adjusted, multiplied by 40 to be comparable to the economy-wide, weekly series. Of course, this may be misleading if there is a big difference in average hours between them, but I wanted a measure that wouldn’t be skewed by Wall Street or Silicon Valley executive salaries. And the green line, on the left scale, is real-terms GDP growth per quarter.

Growth could certainly be higher and unemployment could be going down faster, but both are going clearly in the right direction, and at least in cash-terms, wages are up. This is, in a word, recovery. It’s far from obvious from these data that it constitutes “economic royalism”, even if the economy-wide wages measure is growing faster than nonsupervisory production.

5 thoughts on “The United States economy recovered.

  1. Pingback: [BLOG] Some Wednesday links | A Bit More Detail

  2. The E/P rate is a good point, but if it was the case that the US economy wasn’t recovering at all, would non-supervisory production workers’ earnings be rising?

  3. Trickle-up in evidence. Both average hourly earnings and average hours worked per week down m/m.

  4. (Point being that this looks like a very early stage of a recovery while productivity data and spending data by sector (gov/domestic/external) looks like it is at a rather more advanced stage. And, of course, macro is the art of producing bad outcomes by deciding to solely focus on the factor that is not malleable in the short run.)

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