US warns of dim economic prospect
Wed Jan 11, 2012 6:8AM GMT
The US Department of Commerce has warned of a murky economic prospect for the nation, voicing concern over the expected loss of its leading economic status in the near future.
The report, titled the Competitiveness and Innovative Capacity of the United States, underlines the deteriorating situation of jobs, middle class income, manufacturing, innovation, education, and infrastructure as key factors behind a downward trend for the US economic prospect.
Over the past decade, the US ability to create jobs has worsened and jobless recoveries have become increasingly lengthy, the report said.
Following each postwar recession it usually took America roughly six months to return to the employment recovery level, however after the recessions in 1990-91 and 2001, employment recovery took 15 months and 39 months respectively.
According to the report, the middle class income has “stagnated,” with real median household income falling from $53,252 in 1991 to $52,823 in 2007.
Meanwhile, the income of the top one percent earners on the income distribution chart has grown by almost four percent per year between 1993 and 2008.
In terms of manufacturing, the US has been losing ground, as its $564 billion trade deficit of 2010 is expected to run even deeper in 2011, particularly with regard to key manufacturing sectors that constitute primary drivers for the American economy in the future, including biotechnology products, computers, semiconductors and robotics.
The report also expressed concern about the eroding scientific and technological innovation in the US at the time when many other nations are laying strong foundations in this respect. The latest figures show the US ranks fourth in innovation-based competitiveness.
The study warned, as well, of the downward trends for the US education system, as according to the 2003 program for International Student Assessment, the problem-solving ability of American students stands below those from most other developed nations in the world.
Meanwhile, the report also points to deteriorating condition of the US infrastructure, saying that it has failed to keep pace with the growing population in the country.
It went on to say that digital infrastructure has failed to reach large portions of the US population and some communities are disadvantaged as far as broadband access is concerned.