Economic Report of the President 1994 - The American Presidency ...

which have left consumers and business people wondering how longthe recovery would last.Chart 1 -1 Growth of Real GDP in RecoveriesReal GDP in the current recovery has grown at only about half the rate of thetypical post-World War II recovery.Percent change from trough141 2 3 4 5 6 7 8 9 10 11Quarters after TroughNote: "Average" includes all recoveries from 1954 to 1982, except 1980. The trough quarter for the currentrecovery is first quarter 1991.Sources: Department of Commerce and National Bureau of Economic Research.Thus the Administration's first task was to put the recovery ona sound footing—not to produce a short-run burst of activity, butto lay the groundwork for a sustained expansion that would restoreconfidence and encourage firms to resume hiring. In large measurethis task was accomplished in 1993. (Chapter 2 provides more details.)Sluggish economic growth in the first half of the year gaveway to solid growth in the second half. More important, job growthbegan in earnest: Employers added about 2 million jobs to nonfarmpayrolls between December 1992 and December 1993. As 1994began, the outlook for sustained expansion looked brighter than ithad in a long time.INADEQUATE PRODUCTIVITY GROWTHThe economy's longer run problems will not be dealt with soquickly. They require sustained attention over a long period oftime. Primary among them is the troubling fact that growth in productivityhas been anemic for about two decades.23