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The Recession's Over? Not For Us

The Loop 21, News Report , Raechal Leone Posted: Jun 11, 2009

Forget what all the financial experts are lining up to tell the mainstream media that the recession is over. Americans, especially black Americans, will be feeling the effects of this economic crisis for a long time.

For most of us, the numbers that matter most, such as the unemployment rate, aren't going to move nearly as much as we want them to for months.

The unemployment rate for blacks, now at 14.9 percent, fell 0.1 percent in May, but that's not much help when you're talking about such a big number. Analysts say the overall national unemployment rate, now at 9.4 percent, up 0.5 percent in May, usually increases for about six months after the end of a recession.

Algernon Austin, of the Economic Policy Institute, projects black unemployment won't fall to meet the current national unemployment rate for people of all races for another five years. That's how long it took for the unemployment rate for blacks to fall back to pre-recession levels after the recessions of the 1980s and 2001.

"This Great Recession is hitting black America very hard and it will take a long time for blacks to get back on their feet," said Austin, director of EPI's Race, Ethnicity and the Economy program.

The financial analysts are looking at other indicators, like the real estate market, consumer spending, and claims for unemployment, to pinpoint when the economy is out of trouble all of which are improving.

On the real estate front, the number of homes for sale is declining and the cost to buy a home is increasing, both good signs. Consumer spending was up 2.2 percent in the first three months of 2009. Claims for unemployment insurance fell to 621,000, 4,000 than the week before, continuing a trend. And other indicators were, well, less bad than expected.

Federal Reserve Chairman Ben Bernake told Congress in May the economy should begin growing again in the next seven months.

The Consumer Confidence Index jumped from 40.8 in April to 54.9 in May, its highest level in eight months. Those numbers are based on a monthly survey of 5,000 U.S. households.

But in every report of good news, in every prediction the worst is behind us, there's always a note of caution, a warning that we shouldn't be too relieved just yet.

"The end of the recession does not mean we won't lose more jobs; employment is always a lagging indicator," Brian S. Wesbury and Robert Stein wrote at Forbes.com. "And there will be more defaults, foreclosures and financial market problems too. But none of these are leading indicators."

Hmm, I'm glad the worst recession our economy has seen since the 1930s is technically ending, at least according to the experts. But it's clear that for most us, particularly blacks, it's far from over

Related Articles:

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The Silver Lining Behind Californias Gloomy Economy

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