WASHINGTON – The U.S. economy has reached a milestone: It has finally regained all the private-sector jobs it lost during the Great Recession.
Yet it took a painfully slow six years, and unemployment remains stubbornly high at 6.7 percent.
The comeback figures were contained in a government report Friday that showed a solid if unspectacular month of job growth in March.
Businesses and nonprofits shed 8.8 million jobs during the 2007-09 recession; they have since hired 8.9 million. But because the population has grown since the big downturn, the economy is still millions of jobs short of where it should be by now.
Also, government jobs are still 535,000 below the level they were at when the recession began in December 2007. That’s why the overall economy still has 422,000 fewer jobs than it did then.
As a result, most analysts were hardly celebrating the milestone.
Heidi Shierholz, an economist at the liberal Economic Policy Institute, called it a “pretty meaningless benchmark economically.”
“The potential labor force is growing all the time, so the private sector should have added millions of jobs over the last six-plus years,” she said.
U.S. employers did add a seasonally adjusted 192,000 jobs in March, just below February’s 197,000, which was revised higher. March’s figure nearly matched last year’s average monthly gain, suggesting that the economy has recovered from the hiring slowdown caused by severe weather in December and January.
“We’re seeing sustained improvement,” said Scott Anderson, chief economist at Bank of the West. “But we’re not really that much stronger than we were last year. And we need more improvement for a stronger economy to come into fruition.”
The March figures did signal that stronger gains could lie ahead: More Americans without jobs are starting to look for one, and paychecks are growing.
Most economists expect job growth to pick up a bit to a monthly pace of 225,000 or more. One reason: Americans have reduced their debts and benefited from rising home prices and a rising stock market. Better household finances should translate into more spending.
And a major drag on growth – federal spending cuts and tax increases – will fade this year, most likely boosting the economy.
Budget battles and government shutdowns that have eroded business and consumer confidence since the recession ended are unlikely this year.
“Enough repair has happened in damaged sectors and there’s enough calm … so we can have a real recovery,” said Ethan Harris, global economist at Bank of America Merrill Lynch.