Adam Ozimek, chief economist at Upwork
The recovery from the Great Recession continues. The economy added 164,000 jobs in July, a positive number that exceeded expectations suggests we continue to head in the right direction. However, the data also shows that the pace of recovery has slowed from last year. Over the last three months, job growth has averaged around 140,000, which is more than needed to absorb the growing population, but slower than 220,000 average last year. Trade uncertainty, fading fiscal stimulus, and lingering effects from the Fed’s excessive rate hikes in 2018 remain headwinds. While the data suggest growth has slowed, there is little sign of an imminent recession. Instead it is increasingly clear that we are not at full-employment and have more room to improve. Wage growth is better than it has been but still modest, and wider labor market slack remains elevated and inflation is below target.
This is not what an economy operating at full capacity looks like. Nor is it what an economy on the verge of recession looks like either. What it looks like is a slow, continued recovery. The fact that this is the longest economic expansion in U.S. history is a very mixed blessing. On the one hand, the recovery is still going, and every month that it does means more employment and higher wages for U.S. workers. These benefits are reaching more people and places, including people who have disabilities and places that have lacked economic growth for some time. On the other hand, the long recovery has been a slow recovery. It’s good that the economy is as strong as it is right now, but it would’ve been better had it gotten here years ago. For those who have waited on the side-line unable to find work until now, and for those who still cannot find good jobs, a faster recovery would have left them in a better place today.
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