It's no wonder that our confidence in the economy is at an all-time low. "Americans have been bombarded by new worries in recent days with the war in Libya, unrest in much of the Middle East, and the seemingly endless series of catastrophes in Japan," a recent Gallup poll measuring economic confidence reported. Add to that the weak job market, increasing fuel prices, and fierce budget battles in Congress, and it's clear the U.S. economy still faces serious headwinds on the road to recovery.
What should we brace for next? Here are some numbers worrying economists and Americans alike:
$14.2 trillion. That's the national debt, and it's growing at a breakneck speed of $58,000 per second. High and rising public debt can raise interest rates for consumers and slow economic growth. "If we continue to do this, we nearly guarantee every family that's trying to buy a home or buy a car sees a much higher cost," says Douglas Holtz-Eakin, president of the American Action Forum, a Washington, D.C.-based policy institute. "Family income stagnates, costs are going to rise, and that's the good-news version. It will be just like the financial crisis in 2008, but the recession will be even deeper."
Higher interest rates aren't the only potential side effect of Uncle Sam's borrowing binge. Consumers could also see a weaker job market, higher taxes, and higher inflation down the road.
$3.68. Average fuel prices, currently hovering around $3.68, are up almost 86 cents from a year ago. Prices could go higher amid continuing unrest in the Middle East, and even hit $4 per gallon this summer, the U.S. Energy Information Administration says.
Higher gas prices put pressure on consumer discretionary spending. If Americans have to spend more to fill up at the pump, they'll have less to spend in stores, restaurants, and other consumption-driven industries that power the U.S. economy.
The price of crude oil directly relates to gas-price fluctuations. "Estimates are that for every $10 a barrel increase over the course of 12 months, it can impair economic growth to the tune of about two-tenths of 1 percent," says Mark Luschini, chief investment strategist at Philadelphia, Penn.-based financial services firm Janney Montgomery Scott.
That might seem like a tiny figure, but an economy growing at a sluggish rate of about 3 percent doesn't leave a large margin of safety, he says. "[0.2 percent is] not consequential enough to say 'Well, therefore, the economy is going to roll back into recession,'" Luschini says. But sustained price elevation or prices near the $125 or $130 per-barrel mark could stifle the struggling recovery, he adds.
8.8 percent. The national unemployment rate is slowly creeping down, but at 8.8 percent—a 27-year high—it's still creating significant drag on the economic recovery. Even grimmer is the percentage of Americans who are "underemployed," Luschini says.
Underemployment, which measures the number of part-time workers looking for full-time work, sat at about 19.9 percent in mid-March, according to a recent Gallup poll, nearly identical to the figure a year ago. Although more positive economic data may buoy job seekers' confidence in the long term, the short term is a different story. "What it means is that we're not getting the strength from consumer spending that you would normally expect to see under a swifter recovery in employment," Luschini says.
$157,000. Historically, a resurgent housing market has been a major driver in broader economic recoveries. That premise has been challenged this time around as median home prices—currently $157,000, according to the National Association of Realtors—have continued to slump. "Even though we have historically low or thereabouts mortgage rates and even though housing stock is plentiful and housing prices on an affordability basis are very inexpensive, we're not seeing that same phenomena occur," Luschini says. "People are uncertain about the future or are not fully employed, and that's contributing to why we're not seeing the same recovery in terms of housing this time through, as we've seen in previous cycles."