Economix Blog: What Do You Call This ‘Recovery’?

By now, more than 27 months after the economy officially stopped shrinking and started to grow again, the word “recovery” is starting to look like an imprecise way — at best — to describe what’s going on right now.

With consensus estimates for Friday’s Labor Department jobs report at around 65,000 net jobs added in September, job growth is anemic. Consumer confidence is faltering, and the housing market is still running on fumes.

“The word ‘recovery’ or ‘expansion’ does not resonate with normal people,” said Allen L. Sinai, chief global economist at Decision Economics, a consulting firm. “It resonates only with economists, because technically, we are in a recovery.”

So what do we call this period, when, technically, we are not yet shrinking, but we are struggling to stay in place?

“I have a two-word description,” said Mr. Sinai, who pointed out that since employment started increasing again in March 2010 (lagging behind the official end of the recession), the average gain has been about 110,000 jobs per month, not even enough to keep up with population growth. “This is a crummy recovery.”

Heidi Shierholz, an economist at the labor-oriented Economic Policy Institute, said she wasn’t sure what to call a period that is neither an adequate recovery nor an all-out contraction. As a math geek, she considered using the term “epsilon” to get at the notion of “a vanishingly small amount above a recession.”

But Kevin Hassett, director of economic policy studies at the American Enterprise Institute, a conservative research group, suggests that maybe we are using “recovery” appropriately after all.

“After surgery, they take you to recovery and you don’t feel great while you’re in there,” Mr. Hassett said.

“There are all these words where we use them and we have to stop using them because they have a negative connotation,” he added. “But recovery may be the right word, it’s just that because we kept growing at 6.5 percent in previous recoveries, we started to think of them as good things.”

Readers, what do you call this economic moment?

Article source: http://feeds.nytimes.com/click.phdo?i=96d21cce8ad0706e91c7e298142492ef