Abstract
The economy of the United States is more than three and one-half years into the recovery from the 18-month-long Great Recession, which started in December 2007 and ended in June 2009. It took until the fourth quarter of 2011 for the nation’s total output of goods and services (Gross Domestic Product, or GDP) to finally surpass its pre-recession peak (the fourth quarter of 2007). Thus, it took 10 quarters to achieve full output recovery (second-quarter 2009 to fourth-quarter 2011). However, as of December 2012, a full year later, the United States had recovered only 61.6 percent of the total employment loss that it suffered during the recession. Compared with the rebounds from all post–World War II recessions, the length of the current employment recovery period is unprecedented. Private-sector employment in the United States declined by a staggering 8.8 million jobs between December 2007 and February 2010.1 The long recovery period then commenced and is still under way. From February 2010 to December 2012, the nation regained over 5.9 million private-sector jobs, a 67.7 percent rate of private-sector recovery. Thus, the United States is still inching its way out of an extraordinarily deep employment-loss hole. It needs to add 2.8 million more private-sector jobs just to return to pre-recession employment levels. This excruciatingly long recovery period may not be due only to the sheer depth of the downturn. The nation’s industrial composition has been evolving, with private service-providing activities accounting for both increasing shares of the economy and of recessionary employment losses.