News is out: The economy grew in the third quarter. But don’t start the celebratory parade just yet.
Per the NY Times:
The nation’s gross domestic product expanded at an annual rate of 3.5 percent in the quarter that ended in September, matching its average growth rate of the last 80 years, according to the Commerce Department. But government programs to encourage consumer spending on things like cars and houses are expiring, and employers remain reluctant to hire more workers, suggesting the recovery may not last, economists say.
In other words, the economy’s upward trajectory is juiced, and there’s no certainty whatsoever that it’ll last without the injection of more of the government’s steroid-like consumer incentives. And how long can we go on doing that? I guess it’s working out well for A-Rod.
Regardless, to most people, the big numbers are meaningless. As my colleague Justin Fox writes in the Curious Capitalist, “You can’t eat GDP, or pay your mortgage with it.”
If and when the economy recovers, most people will feel the shift in tangible ways that truly mean something to their lives. For instance, they’ll actual begin collecting a salary again. So, do you feel like the downturn is over? It ain’t over until people start bidding wars on McMansions again. Here are ten signs that the economy has yet to get its groove back.
1. Stubborn fact: Unemployment is at 10 percent. Employers aren’t expected to start hiring en masse either, so experts say the number of unemployed hasn’t even hit its peak yet. Since the Great Recession began, 7.6 million (and rising) workers have lost their jobs.
2. Less candy on Halloween. The horror!
3. Cities are paying a fortune on landscaping. Why? They have to mow the lawns on all the foreclosed properties.
4. NBA teams are cutting holiday parties. They’re also trimming player rosters, looking into digital tickets rather than paper, and bringing in kids as half-time entertainment instead of paying for pro performers—all as cost-saving moves in a year that’s expected to be bad for business.
5. NFL teams are lowering ticket prices. At least the Jets are. Plenty of other teams have struggled to sell out home games, prompting them to blackout games on TV and alienate fans in the process.
6. Schools are canceling or downgrading class trips. In a survey, more than one out of every six schools have had to do so, and the numbers are expected to go to one out of four next year. Why? School budgets are slashed, and the bake sales and car washes just can’t fill the void.
7. There are more youth runaways. The recession is being blamed. Scary.
8. Fewer McMansions. Of those still being built, prices are down, as is size: The median new home size was 2,309 square feet in 2007, and 2,091 square feet today.
9. No more McDonald’s in Iceland. Because of the struggling local currency, the country’s only three franchises have found it too cost-prohibitive to stay in business. As a WSJ editorial noted, an Icelander must now travel 700 miles (to Dublin, Ireland) to satisfy a Big Mac craving.
10. Retailers have felt the need to add another Black Friday. It’s today, actually, Friday, October 30. Door Buster sales, which are usually the domain of the Friday after Thanksgiving, start at 5 p.m. today at Sears. Macy’s stores are giving away $10 gift cards to the first 100 shoppers tomorrow.