The “Great Recession” has ended, officially.
At least, that's the word from the private, nonprofit research organization that calls the beginnings and endings of recessions, the National Bureau of Economic Research.
The NBER said Monday that the recession which began in December 2007 ended in June 2009, which marked the beginning of an expansion. The announcement rules out the possibility of a so-called “double-dip” recession, because any new downturn would be seen as a brand new recession.
President Barack Obama said that even though the NBER officially named an end to the recession, the economy has a long way to go and much work to be done to become healthy again. "Something that took ten years to create is going to take a little more time to solve," Obama said at a town-hall-style meeting shown live on CNBC.
The NBER said it chose the June 2009 date based on examination of data including gross domestic product, employment and personal income.
"The recession lasted 18 months, which makes it the longest of any recession since World War II. Previously the longest postwar recessions were those of 1973-75 and 1981-82, both of which lasted 16 months," the NBER added in a press release on its website.
Just because the recession ended 15 months ago, it doesn't mean that the economy is healthy, the NBER asserted. "Economic activity is typically below normal in the early stages of an expansion, and it sometimes remains so well into the expansion," the NBER said.
In April, the NBER declined to call the end of the recession, and some of its members said at the time 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.
The NBER normally takes its time in declaring a recession has started or ended.
For instance, the NBER announced in December 2008 that the recession had actually started one year earlier, in December 2007.
Similarly, it declared in July 2003 that the 2001 recession was over. It actually ended 20 months earlier, in November 2001.
Its determination is of interest to economic historians — and political leaders. Recessions that occur on their watch pose political risks.
In President George W. Bush's eight years in office, the United States fell into two recessions. The first started in March 2001 and ended that November. The second one started in December 2007.
NBER's decision means little to ordinary Americans now muddling through a sluggish economic recovery and a weak jobs market. Unemployment is 9.6 percent and has been stuck at high levels since the recession ended.
Many will continue to struggle.
Unemployment usually keeps rising well after a recession ends. Four months after the 2007 downturn ended, unemployment spiked to 10.1 percent in October 2009, which was the highest in just over a quarter-century. Some economists believe that marked the high point in joblessness. But others think it could climb higher — perhaps hitting 10.3 percent by early next year.
After the 2001 recession, for instance, unemployment didn't peak until June 2003 — 19 months later.