A Dec. 22 American Public Media Marketplace broadcast titled “How 2 percent GDP growth looks in the real economy” featured an interview with Ann Owen, the Henry Platt Bristol Professor of Economics. Owen commented on the relatively small gross domestic product (GDP) growth rate, observing that typically, after a recession caused by a financial crisis, growth tends to be slow initially.
“We’re doing a little bit better than treading water,” she said. According to Marketplace reporter Tracey Samuelson, Owen observed that going forward, modest GDP growth will mean modest increases elsewhere in the economy, from interest rates to wages. However, if this 2 percent rate of growth persists, the thing to watch will be who is getting those wage increases.
“When we have really big increases in GDP, typically, everybody sees an increase,” said Owen. “When we have more modest increases, it becomes more of a concern that everybody is not seeing the increases.”