For Mark Roberts’ Use: It has been six years since the official end of the Great Recession. And yet, many of us are still wondering when we’ll see a true, dramatic improvement in the economy.
Good news: Several key indicators, commonly used as predictors of economic activity, are giving us good reason to feel hopeful about the direction we are headed.
Employment. Each quarter, the Bureau of Labor Statistics releases official numbers relating to jobs created and lost. From November 2014 to January 2015, more than one million new jobs were created. This time period represents the best three-month stretch since 1997! The unemployment rate has also dropped to 5.7 percent, and there were five million open positions at the end of December.
Consumer activity. The Consumer Confidence Index rises or falls depending upon how consumers feel about their current financial status and future prospects. This is considered an important measure of how our economy is performing, because household spending accounts for more than two thirds of overall activity in our economy. During the fourth quarter of 2014, consumer spending grew at the fastest pace it has seen in eight years, and the CCI reached its highest level since August 2007.
Housing. The national median home price rose 5.8 percent in 2014, reaching its highest value since 2007. Housing starts also improved more than 18 percent. Home building tends to boost employment, and a healthy housing market often has positive effects on local businesses. People who buy homes also purchase appliances, furnishings, and other home goods and services. When market prices and home equity are rising, homeowners feel wealthier in general and may be more comfortable spending money on big-ticket items such as cars and vacations.
All three of these factors point toward a promising upswing in our economy, and 2015 could be the best year we’ve seen in recent history.