Recession is over, technically

By Tom Raum - The Associated Press

WASHINGTON -- It's about to become official: The recession is over — but not the pain.

The government will release figures this week expected to show that the economy has awakened from its deepest slump since the 1930s and is in the early stages of a recovery. But the following week, the government will issue another set of figures expected to show unemployment continuing to rise toward and possibly above a clearly recessionary 10 percent.

How can both be possible?

The government releases third-quarter Gross Domestic Product figures today. Many forecasters say they will show GDP growing at an annual rate of about 3 percent, validating a widely held belief among economists that the recession ended in June or July.

Assertions by government and private economists that the recession is over — issued amid graphic examples of continuing wide distress — are raising fresh questions about economic scorekeeping.

The national recession technically might be over, but the state of the economy remains in the eyes of the beholder.

A survey of economic forecasters prepared by Blue Chip Economic Indicators, a research organization, predicted GDP growth to remain positive in each quarter through the end of 2010. In a survey by the National Association of Business Economics, 34 of 43 economists polled said the recession is over.

But nobody is sugar coating the statistics, especially in the administration, which agrees with private surveys suggesting that unemployment will hover near 10 percent through most of next year.

“Even when you've turned the corner, you have so much work to do,” said Christina Romer, the chairwoman of the White House Council of Economic Advisers.

While there are clear signs of recovery, it is uneven.

Stocks have surged about 50 percent since their March lows, but other businesses are struggling, and many have failed or are failing.

That disconnect sparked anger among the public and led to government action last week to limit executive compensation at financial firms given bailout money.

There have been modest improvements in parts of the nonfinancial business sector, yet lingering signs of weakness in commercial real estate and retail spending.