Recession Officially Over, U.S. Incomes Kept Falling Between June 2009, when the recession officially ended, and June 2011, inflation-adjusted median household income fell 6.7 percent, to $49,909, according to a study by two former Census Bureau officials. During the recession â from December 2007 to June 2009 â household income fell 3.2 percent. Ok what the hell happened? Possible reasons: a) teachers unions b) Frodo took too long to get rid of that ring c) gay marriage d) people don't own an american flag lapel pin e) people forgot 9/11 f) the sequels to the Matrix were so disappointing it affected the american psyche (explains why income dragged during Generalissimo Bush's reign of teh dumb) g) the prequels to Star Wars were so disappointing it affected the american psyche (explains why income dragged during Generalissimo Bush's reign of teh dumb) h) we still have butter called I can't believe it's not butter i) kenyan socialists This country is so messed up that the press calls a guy a job creator even though his state's unemployment rate increases. Harrumph!
How about the fact that the economy has grown while incomes have dropped. Corporations have figured out they can shrink wages and benefits, due to the number of un/underemployed workers since the recession took it's toll. A large number of companies are posting record profits, thanks to lower labor costs. Although f) and g) above are good explanations.
Another big part of the equation is/was the falling dollar. It remains to be seen what corporations can accomplish if we have a brief spell of a stronger dollar.
We buy more ink and copy machines. Geez. It's almost like you think that inflatin' the bejebbers out of the money supply is a bad idea or sumtin'!
Just take a look at debt growth in the past ten years. We BORROWED THAT "Growth". Don't take this as gospel but I recall mortgage debt grew from 3tr in 2000 to 9tr at the end of 2009. Denniger over at the market ticker has posted quite a few charts showing this growth in overall debt. I seem to recall he figured GDP growth has been running at 4%+/- while debt growth has exceeded 7%.
That's right, borrowed it from countries like China, who had trillions to lend thanks to our consumption of their cheap goods. I heard on CNBC that with earnings season hitting full swing, analysts are expecting ~13% earnings growth. As incomes shrink. And unemployment claims continue to rise. And over 10 million American children don't have enough to eat. And we wonder why they Occupy Wall Street??
That income curve is largely due to outsourcing and H1B visa insourcing. I just got a job offer at a salary I had received 25 years ago. Of course, I'm in IT where it's the pits and I'm competing against a million "mudmen" from India.