WASHINGTON — The pile of economic data indicating the worst of the recession is over just keeps growing. In the past few weeks, the government reported businesses last month shed the smallest number of jobs in nearly a year. The savings rate, after rising rapidly, held steady at levels not seen in at least five years. And from April to June, productivity surged to a six-year record.

But the same data also explain why the recovery isn’t going to feel like one any time soon for millions of Americans. Its existence will be confirmed by statistics but, over the next year at least, the benefits are unlikely to materialize in the form of higher wages, tax receipts or jobs.
“It’s going to be a recovery only a statistician can love,” Wells Fargo senior economist Mark Vitner said.
A few recent pieces of data offered reasons for both hope and trepidation.
The Labor Department reported Tuesday that business productivity jumped between April and June to a seasonally adjusted annual rate of 6.3 percent, far higher than the annual average of 2.6 percent between 2000 and 2008. Higher productivity helps raise living standards in the long-run and is good for corporate profits because it allows companies to produce more without paying higher labor costs. But the boost in productivity was largely due to businesses slashing hours faster than output. Labor costs per unit fell, but so did the buying power of workers, further constraining already weak consumer spending, which drives 70 percent of the economy.
Increased productivity, combined with other factors, could also bode poorly for employment because as long as businesses can do more with fewer people they can delay the resumption of hiring. Adding to that potential delay is the fact that employers have already slashed hours to an unprecedented degree to make it through the recession. The average time spent working each week is at a record low, and just under 9 million people are working part-time for economic reasons.
“Before you see hiring, firms have an awful lot of latitude to increase hours,” said Richard Moody, chief economist for Forward Capital, an Austin-based investment research firm.
As a result, many economists say a jump in productivity increases the odds the recession will be followed by a “jobless recovery,” similar to the one that followed the 2001 recession. That downturn saw similar productivity gains. Once it was officially over, it took 55 months before a greater share of Americans had jobs than had them when the recession ended, compared to 29 months after the 1990-91 recession and just seven months after the 1981-82 recession, according to an analysis of government data by University of California at Berkeley economist Brad DeLong.
Another piece of encouraging news — the July jobs report — showed unemployment edging down to 9.4 percent from 9.5 percent as the pace of layoffs slowed. But the rate also fell largely because more than 400,000 people dropped out of the labor force and therefore didn’t get counted as unemployed. Another disturbing development was that the number of people out of work for 27 weeks or longer reached a record 5 million, accounting for a third of the unemployed. That suggests to some economists that those job losses were due to structural changes in the economy and that many of those people won’t be called back to work once the economy picks up. The longer people are out of work, the harder it becomes for them to find jobs and the more likely they are to exhaust savings or lose their home to foreclosure.
“Economists are using one concept of recession that is at total variance of how a normal human being thinks of it. A normal human being thinks of a recession as, you fell into a hole and as long as you’re in a hole, you’re in a recession,” said Lawrence Mishel, president of the Economic Policy Institute. “Economists think of it as ... when the economy stops shrinking.”