The United States continues to confront a weak economic recovery. According to today’s employment report by the Bureau of Labor Statistics, payroll employment increased by 117,000 in July, and the unemployment rate edged down to 9.1 percent. The private sector added 154,000 jobs while governments continued to shed jobs. Furthermore, recently released GDP numbers show that economic growth fell far more during the worst part of the recession than was previously thought, and the pace of recovery since then has been well below that seen in past recoveries and weaker than expected.
As policymakers turn attention back to policies to drive a near-term economic recovery, it is also crucial to target longer-term policies that will spur the pace of U.S. innovation, boost earnings for American families, and raise our competitiveness in the global economy. In this month’s posting, we focus on the role of innovation in determining American living standards. We also continue our look at the nation’s “job gap,” or the number of jobs that the U.S. economy needs to create in order to return to pre-recession employment levels while also absorbing the 125,000 people who enter the labor force each month.