Expansion hits year 9

Economic recovery has staying power

WASHINGTON - The U.S. economy acquired an exclusive label on Friday: Recession-free for eight full years. Yet the third-longest economic winning streak in American history still doesn’t get much love.

No wonder: Despite its longevity, this expansion has delivered subpar gains in its pace of growth, full-time hiring and pay increases since it emerged from the Great Recession in June 2009. It’s the weakest economic recovery since World War II.

And the gap between the richest among us and everyone else has widened.

Still, the economy is hardly the disaster that President Donald Trump insists he inherited. Employers have been hiring steadily, month after month, since 2010. And a majority of Americans now enjoy unusual job security.

Here are five things to know about the expansion as it trudges into Year 9:

Staying power: The National Bureau of Economic Research has been measuring U.S. recessions and expansions since the 1850s. Over that time, only two expansions have matched the lifespan of the one that officially began in June 2009 and has endured for 96 months:

A 106-month expansion that ran from February 1961 to December 1969, when President Lyndon Johnson stoked growth with spending on domestic programs and the Vietnam war.

A 120-month streak that began in March 1991 and ended in March 2001, after the dotcom bubble burst.

What’s more, employers have added jobs for 81 straight months — easily the longest streak on record.

It’s no boom: Compared with the other two long-lasting expansions, the current one looks weak. America’s gross domestic product has grown less than 19% over the past eight years, much less than the 51% growth posted in the first eight years of the 19611969 expansion and the 34% in the same span of the 1991-2001 expansion.

Job growth has been consistent but hardly robust. A big reason is just how bleak the job picture was eight years ago. The Great Recession wiped out 7.4 million jobs. And the job market didn’t actually hit bottom until February 2010 — eight months after the recession ended.

Little government help: Government spending usually plays a vital role in restoring economic health after recessions. Faced with the deepest downturn since the 1930s when he took office in January 2009, President Barack Obama pushed through Congress an $862 billion stimulus package. Many economists credit the blend of tax cuts and spending increases, in no small part, for reviving the economy.

But once Republicans won the House of Representatives in 2010 and the Senate in 2014, they proved reluctant to commit to more spending at a time when budget deficits were soaring. Likewise, state and local governments cut back.

The result was that government spending and investment at all levels — federal, state and local — dropped 6% in the first eight years of this expansion.

Meager pay gains: Americans are still waiting for shrinking unemployment to translate into healthier wages.

According to government data gathered by the Economic Policy Institute dating to 1947, pay for rank-and-file workers, adjusted for inflation, rose just 3.5% from 2009 to 2016. That was a sharp slowdown from the 6% increase from 1991 to 1998 and 13.5% from 1961 to 1968.

Rich get richer: As the economy rebounded from the Great Recession, the very richest benefited most. Emmanuel Saez, an economist at the University of California, Berkeley, found that 52% of income gains from 2009 to 2015 went to the richest 1% of Americans.