By: Karen Dynan, Assistant Secretary for Economic Policy at the U.S. Department of the Treasury
The U.S. economy continues to strengthen. Last week, we learned that 209,000 jobs were created in July. This increase represented the sixth consecutive monthly payroll gain of more than 200,000—the longest such stretch since 1997. Over the past 53 months, our private sector has produced nearly 10 million new jobs. The unemployment rate has fallen nearly four percentage points from its peak of 10 percent in October 2009, dipping to a six-year low of 6.1 percent in June before edging back up to 6.2 percent in July on an increase in labor force participation. With real GDP having grown at a strong 4 percent pace in the second quarter, the economy is now 6.6 percent larger than it was before the Great Recession.
We are seeing improvements across many sectors of our economy. The United States is now the world’s leading producer of petroleum and natural gas, producing more oil at home than we import. Manufacturing is gaining strength having added more than 700,000 jobs since February 2010—the strongest job growth over any comparable period since the late 1990s. The auto industry is thriving, with auto sales running at an annual rate of more than 16 million units in recent months, and the housing market is rebounding with fewer homes underwater. With the Affordable Care Act in place, health care costs have risen at the lowest rate in nearly a half century. And our budget deficit as a share of the economy has been cut by more than half since 2009, the largest four-year decline since the demobilization from World War II.
All told, the recent economic news offers much reason for optimism. With headwinds resulting from the global financial crisis largely behind us, the underlying fundamentals are solid and supportive of continued economic momentum. Consistent with this view, a consensus of private sector economists projects strong economic growth through the end of 2015. Yet, unemployment is still too high; there is more work to be done so that every American feels the benefit of our continued recovery from the Great Recession.
The President has proposed initiatives to spur job creation, accelerate growth, and expand opportunity so that more Americans can participate in the economic recovery and share the prosperity created by our economy over the longer run. These common sense proposals include investing in our infrastructure for the long-term, raising the minimum wage and making student loan payments more affordable. We at Treasury are doing our part to help support and strengthen working families and keep our economy growing by doing things like partnering with the Department of Housing and Urban Development to support the construction and preservation of affordable rental housing.
Constructive policy steps by this Administration, along with the resilience of America’s workers and businesses, have helped the United States’ economy recover faster than almost any other advanced economy in the world. Going forward, our goal is to ensure that economic growth continues to be strong, with the gains shared broadly throughout our country.
