After overcoming significant political and economic headwinds during the past decade, the US economy now appears to have undergone its longest sustained expansion in history. Yet, behind the data showing historically low unemployment and long-awaited wage growth lie vulnerabilities that cannot be ignored.

LONDON – Data released over the next few months will show that the current US economic expansion is the longest on record. But while the United States continues to outperform other advanced economies, this success has yet to dispel many Americans’ persistent sense of economic insecurity and frustration; nor does it alleviate concerns about the lack of policy space to respond to the next economic downturn or financial shock.

The current expansion began in mid-2009, following the 2008 financial crisis and the “Great Recession.” Powered initially by exceptional fiscal interventions and previously unthinkable monetary policies, the economy built enough of a foundation for private-sector confidence to return, and for corporate balance sheets to recover. Coupled with accelerating advances in new technologies, the expansion came to be led in large part by technology and platform companies presiding over the new “gig economy.” It was given further impetus by pro-growth measures, including deregulation and tax cuts.

With the US unemployment rate at 3.6%, real (inflation-adjusted) wages are now growing at 1.6%. And with the most recent quarterly data indicating an annualized GDP growth rate of 3.1%, US economic activity continues to outpace that of Europe and Japan by a significant margin. Owing to this strength, America has become increasingly assertive in pursuing national objectives abroad, including by circumventing longstanding cooperative and conflict-resolution mechanisms and threatening import tariffs and other protectionist measures.

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