WASHINGTON (Reuters) - The recession ended in June 2009, making it the longest downturn since the Great Depression of the 1930s, the National Bureau of Economic Research said on Monday.
The NBER, considered the arbiter of U.S. recessions, said its declaration did not mean the economy had “returned to operating at normal capacity” and cautioned that economic activity sometimes remains below normal well into expansion.
President Barack Obama, under pressure to speed up the pace of recovery and drive down unemployment as November congressional elections near, said the official end of the recession did not change the grim reality for many people.
“Economists may say that the recession officially ended last year,” Obama said. “Obviously for the millions of people who are still out of work, people who have seen their home values decline, people who are struggling to pay their bills day to day, it’s still very real for them.”
The NBER’s business cycle dating committee, a private sector group composed of academic economists, is notorious for taking its time in declaring the start and end of recessions.
The committee said it waited to make its decision this time because it wanted to review revised data on national income, released August 27, to get a clearer reading on the path of economic output in 2009.
After a meeting in April, some of the panel’s members said they were concerned the economy could dip back into negative territory. In Monday’s announcement, the NBER said any fresh downturn would mark a new recession, not a continuation of the one that began in December 2007.
“The basis for this decision was the length and strength of the recovery to date,” the NBER said.
U.S. officials have been struggling to find a way to speed up a sluggish recovery that has left unemployment at a painfully high 9.6 percent. The U.S. Federal Reserve’s policy-setting committee meets on Tuesday, and is widely expect to discuss whether additional measures are warranted to bolster the economy.
“Due to the lack of improvement in the labor market, particularly the stubbornly high unemployment rate, the recovery still feels like a recession to many households,” said Harm Bandholz, chief U.S. economist at UniCredit Research in New York. “The NBER does not seem to be too enthusiastic about the economic outlook either.”
(For NBER's statement, see: here)
Reporting by Emily Kaiser; Editing by Andrea Ricci