Recovery Scorecard – April 2021

Recovery Strengthens but Labor Markets Still Lag

Peter Bernstein, Vice President,, 312-431-1540 x1515

The economic recovery strengthened in April as RCF’s Recovery Scorecard index rose to 93% from March’s 86% level.  14 of our 16 economic variables improved in April, with 6 measures now higher than they were before the recession.  Nonetheless, labor markets – typically the last segment of the economy to recover – remain below their pre-pandemic peaks.  Payroll employment has recovered only 63% of its recession losses and the labor force has recovered just 57% of its losses.  On the plus side, real consumer spending is now higher than it was before the recession, and while most of this was driven by government payments, real income less government transfers improved in April. 

Recovery Progress by Economic Variable

Notes and methodology:  All data are seasonally adjusted monthly values.  Variables 4 through 9, and 13 are data from April; all others are from March. Example calculation for economic variable #1, real income less government transfers fell 8.1% from its February 2020 value to its low point in April 2020.  In the latest available report, the variable was 1.2% below its peak value.  Therefore, it has recovered 85% of the loss.  Data Sources: #1, 2, 3, 12, 13: Bureau of Economic Analysis; #4, 5, 6, 7, 8:  Bureau of Labor Statistics; #9: U.S. Employment and Training Administration; #10: Federal Reserve; #11: Bureau of the Census; #14, 15: Bureau of the Census and U.S. Department of Housing and Urban Development, #16:  National Association of Realtors.

GDP Has Nearly Recovered Its Losses

Real GDP, a quarterly metric not included in our monthly index, has nearly recovered its severe recession losses.  From its peak in 2019Q4 to its low point in 2020Q2 real GDP declined 10%.  A strong 2021Q1 put real GDP just 0.9% below its pre-recession peak, meaning that it has recovered more than 90% of its recession loss.  While the recovery is faster than many expected during the depths of the Covid recession, real GDP remains about 4% below where it would have been if it had continued to grow at its trend rate. 

Appendix – Recent History of Recovery Scorecard

Note:  Historical data are often revised so comparisons with earlier RCF Scorecards may reflect the impact of revisions.