Business

US recession 'longest since WWII'

  • 21 September 2010
  • From the section Business

The US recession lasted 18 months and was the most prolonged since World War II, a report has concluded.

The National Bureau of Economic Research said the recovery began in June 2009, with recession having begun in 2007.

Its views carry weight in the US, even though there is usually a lag before it reaches a position, said BBC World Service economics editor Andrew Walker.

The organisation's figures take in data beyond simply GDP.

Income, employment industrial production and wholesale retail sales also form part of the analysis.

The previous longest postwar recessions in 1973-75 and 1981-82 both lasted 16 months, it said.

Meanwhile, President Barack Obama, speaking in Philadelphia on Monday evening, said the end of the "Great Recession" would come as little solace to the millions of people who were still out of work.

"Even though economists may say that the recession officially ended last year, obviously for the millions of people who are still out of work, people who have seen their home values decline, people who are struggling to pay the bills day to day, it's still very real for them," Mr Obama said.

Growth downgrade

In its report, the NBER said: "The committee did not conclude that economic conditions since that month have been favourable or that the economy has returned to operating at normal capacity.

A US factory
The report took in data including industrial production

"Rather, the committee determined only that the recession ended and a recovery began in that month."

Separately on Monday the Organisation for Economic Co-operation and Development (OECD) also cut its US growth forecast.

The OECD predicts the US economy will grow by 2.6% this year, having previously predicted expansion of 3.2%.

It also warned in its latest economic survey of the US that the downturn may trigger long-term damage to the economy, with higher long-term unemployment.

Meanwhile, the UK's Centre for Economics and Business Research (CEBR) said that it expected the US economy to expand by 2.2% next year, after growing by 2.5% this year.

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