In December 2007, the United States entered into the longest recession it’s been in since World War II. Because the economic downturn was so severe, the recovery since the end of the Great Recession in June 2009 was slow, according to the Federal Reserve Bank of New York.
But how is the nation as a whole doing now compared with where it was 10-plus years ago, at the start of the Great Recession? GOBankingRates looked at economic trends to find out how well our nation has recovered.
Click through to see how the U.S. has changed since the Great Recession.
Unemployment Has Dropped Dramatically
The highest the unemployment rate climbed during the Great Recession was 9.5 percent, according to the Bureau of Labor Statistics. However, the percentage of unemployed workers continued to climb even after the end of the recession. The unemployment rate hit a high of 10 percent in October 2009 and didn’t fall below 9 percent until October 2011.
Now, unemployment in the U.S. is the lowest it’s been since 2000. As of December 2017, the national unemployment rate was 4.1 percent.
But Some States Have Higher Unemployment Now
Not all states have recovered from the Great Recession as well as the nation as a whole. The unemployment rate is actually higher now in 10 states and the District of Columbia than when the recession started.
Alaska has the highest unemployment rate of any state — 7.2 percent, up from 6.4 percent in December 2007. Its high unemployment rate and debt per capita make Alaska one of the least recession-proof states, another GOBankingRates study found.
Labor Force Participation Has Declined
Although the unemployment rate has dropped dramatically since the Great Recession, the percentage of Americans in the labor force has fallen. In December 2007, 66 percent of people 16 and older were employed or looking for work, according to the BLS. As of December 2017, 62.7 percent of the 16-and-older population was in the labor force.
Part of the decline in the labor force can be attributed to Baby Boomers who have retired, according to the Pew Research Center. But there also are Americans who’ve given up on being able to find a job and have dropped out of the workforce.
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Home Values Have Recovered
The housing market was hit hard by the recession. For the most part, though, home values in the U.S. have recovered.
As the U.S. was coming out of the Great Recession in June 2009, the median home value was $172,000, according to Zillow. However, home values continued to drop, until hitting $151,000 in October 2011. They started to climb again in June 2012, and now the median home value in the U.S. is $206,300.
But Not All Housing Markets Have Recovered
Although home values have increased nationwide since the recession, the recovery varies greatly from state to state.
For example, the median home values in Illinois and New York have fallen 14 percent and 16 percent, respectively, since the start of the recession in December 2007. But home values in states such as Colorado, North Dakota, Tennessee and West Virginia are up 20 percent or more since the start of the recession.
Wages Have Risen
Nationwide, the average hourly wage has increased 17.4 percent since the Great Recession. In May 2008 — about six months into the recession — the average hourly wage was $20.32. As of May 2016, the average hourly wage had risen to $23.86.
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But Wage Increases Haven’t Been as Big in Some States
Nearly half of the states haven’t seen wages grow as much as the national average increase of 17.4 percent. Michigan has had the smallest increase — 10.4 percent — followed by Idaho, with 12.3 percent.
The biggest increase has been in North Dakota, where the average hourly wage has jumped 34 percent from $16.90 to $22.66. In fact, another GOBankingRates survey found that North Dakota is one of the best states if you’re unemployed and want a job.
The Job Market Has Grown
The job market has grown since the recession — but it’s been slow. It took until April 2014 for employment to reach its pre-recession level, according to a report published by the Brookings Institution’s Hamilton Project.
But the total number of jobs in the U.S. is now higher than before the Great Recession. As of 2016, there were 156 million jobs compared with nearly 149 million in 2006 before the recession began, according to the BLS.
Some Sectors Are Still Struggling
Despite overall growth in the job market, the recovery hasn’t been industry-wide. The service sector — especially educational and healthcare services — has seen the most growth in the number of jobs. But employment has declined in industries such as mining, construction and manufacturing, according to the BLS.
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A Smaller Percentage of Real Estate Loans Are Delinquent
During the recession, the percentage of residential property owners who fell behind on loan payments grew. But delinquencies didn’t peak until the first quarter of 2010, when the rate was 11.5 percent.
Now, residential loan delinquencies are a fraction of what they were in 2010. As of the third quarter of 2017, the delinquency rate was 3.62 percent.
Credit Card Delinquency Rate Is Lower — But on the Rise Again
The percentage of consumers who fell behind on credit card payments hit a high as the U.S. was coming out of the recession. In the second quarter of 2009, the credit card delinquency rate was 6.77 percent, according to the Federal Reserve. By 2015, the delinquency rate had fallen to 2.12 percent.
But credit card delinquencies have been on the rise again, which could be a warning sign that another recession is coming. As of the third quarter of 2017, the delinquency rate was 2.53 percent.
Household Debt Is at an All-Time High
The total amount of debt owed by Americans is higher now than during the recession. Household debt hit a high of $12.68 trillion in 2008, according to the Federal Reserve Bank of New York. However, it passed that mark in May 2017 and hit $12.96 trillion in the third quarter of 2017.
Credit Card Debt Has Topped Recession Levels
Consumers haven’t shied away from credit cards since the recession. In fact, Americans have more credit card debt — a lot more. When the recession started in December 2007, Americans had $1.001 trillion in revolving debt, which is primarily credit card debt, according to the Federal Reserve Bank. It climbed to $1.02 trillion in April 2008 then started falling in July 2008.
But now credit card debt in the U.S. has topped the high hit during the recession. As of November 2017, Americans owed a total of $1.022 trillion.
Student Loan Debt Has Soared
Student loan debt has soared since the Great Recession started. In the fourth quarter of 2007, Americans had $589 billion in student loan debt, according to the Federal Reserve. As of the third quarter of 2017, student loan debt had reached $1.48 trillion.
Interest Rates Are Lower
In response to the recession, the Federal Reserve lowered the federal funds rate — the benchmark interest rate — from 5.25 percent in September 2007 to a range of 0 percent to 0.25 percent in December 2008. It didn’t start raising its target rate until the end of 2015.
Now, the target rate is 1.25 percent to 1.5 percent. Rising interest rates can have a big impact on consumers’ finances.
Stocks Have Soared — But Are Now Falling
The stock market tumbled during the recession. The Dow Jones Industrial Average was trading above 13,000 in December 2007 but dropped below 7,000 by March 2009. But it’s been rising since then and was at a record high of 26,616 on Jan. 26, 2018.
However, stocks were falling hard as of early February. The Dow dropped 1,032 points on Feb. 8, and CNBC reported the following day the Dow was headed for its worst week since October 2008.
Methodology: GOBankingRates surveyed economic factors during the Great Recession through today to determine how the conditions have changed over time, including unemployment, wage and labor force participation, sourced from the Bureau of Labor Statistics; charge-off and delinquency rates on loans and leases at commercial banks, sourced from the Federal Reserve; and median home values, sourced from Zillow.