The "Great Recovery," or many individual recoveries?

We launched this blog more than two years ago, with the hopes of helping companies re-connect with consumers, and find a road through The Great Recession. Since day one, I’ve been looking forward to writing a story about The Great Recovery.

But it seems like this particular recession was enough of a shock to the system that few people are prepared to declare it over (according to this story from the New York Times last weekend). This, in spite of retail sales that seem to be regaining consciousness (see this story from Media Post), the stock market closed above 11,000 for the first time since 2008 last Monday (see this story from the NY Times), and employment numbers are getting stronger.

Implications: Few prognosticators saw this recession coming… or at least, many professional pundits grossly underestimated the severity and velocity of its’ arrival. Being late to predict the arrival of an economic decline is one thing, but following that error by prematurely announcing its departure would be about enough to make folks doubt your “seer” capabilities. (I’m not the only one who’s thinking that way. See this NY Times business/opinion piece.)

From the perspective of the White House, the Federal Reserve, or the Treasury, I suspect this “contained enthusiasm” for the recovery is also a product of setting realistic expectations. (Remember when a President declared major battle operations to be over in a recent war? In his eagerness to celebrate, it set the wrong expectations.) It takes up to fifteen months for history to shed factual light on all of the numbers that go into determining that either a recession or recovery has taken a significant turn. That’s one of the reasons that a recession which started in December, 2007, was not officially announced until one year later.

If you live in the “Jones” household, the recession will end when the Jones’ are earning a household income that they can be comfortable with (either because it is strong and stable, or the family has learned to live with one that is not). The recovery will be underway when you can afford a lifestyle that is better than the one you experienced during the recession, if not the one you enjoyed before it.

There’s a good chance that no “Great Recovery” will happen in the near term. There will not be one date we can mark on the calendar that marks a time when everyone stopped being in a recession and started living in a recovery.

Instead, be watching your customers and prospects… and be prepared to help them celebrate the millions of individual and family recoveries that are either underway… or coming soon.

Mike Anderson