My group group have to submit Project on the Recession ,in the following topics my topic is 5)Response to the Great Recession , i need to write 5 articles about this topic with references. 1) Abstract

EFFECTS OF THE FINANCIAL CRISIS AND GREAT RECESSION ON AMERICAN HOUSEHOLDS

https://www.nber.org/papers/w16407.pdf

Michael D. Hurd and Susann Rohwedder write this article. This article explains the effects of financial crisis of 2008 on American households. Housing prices across the nation increased to maximum values in 2006, the housing prices has started declining in 2007 as result of the financial crisis and by the year 2008 when the great recession period has begun housing price declined sharply and got worsened as the unemployment has skyrocketed as a result of the recession. The article used survey data to analyze the data on financial crisis and Housing. By April 2010 39% of the people experienced financial hardship, most of the household financial distress caused by the unemployment rate, pay cuts, not able to pay the mortgages for few months after the crisis. Younger people aged between18-35 years more affected than the older generations who are above 60 years of age. The House price drops were more dependent on the areas where it had great impact because of recession like in Detroit where automotive industry, which was highly impacted, had seen more than 40% of drop. In the normal times there would chances of spending money on housings, whereas, during the crisis times the average spending decreased by more than 20%, with increased unemployment rates there’s very less scope from 2007 to 2009 on getting better for housing prices. Based on data from the article 64% of the overall population has own homes and out of which 47% of the people are unemployed as a result of financial crisis and the great recession of 2008.

Impact of the Great Recession of 2009 on the US Tourism Industry and Performance:

https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3072031

Alice Zhang writes this article. This article explains the impact of great recession in the field of Tourism and its performance. Based on the data, several tests and surveys it is evident that the great recession has direct and indirect impact on the tourism. Almost more than 84% of the travel firms affected during the financial crisis, and it had negative correlation to the liquidity, profits and growth. US Tourism has significant amount to the overall economy, 2.6% to the gross national production. US travel receipts contributed to the US exports receipts by decent amount. In normal years US accounts for 6.5% of overall worlds travelers, and the revenue generated of 16.5% compared the world travelers. The Tourism firms mainly get the revenue from both the international and domestic travelers and of which is purely depend on a healthy economy, but in the great recession time because of several factors like lower wages, job losses and restrictive spending on leisure had affected a lot. Many researchers tried to analyze the best fitting model on how economic recession could affect Tourism industry. ROE (Return on Equity) ROA (Return on Asset), ROE would significantly help to understand on the performance of how a firm is performing by considering several factors. From taking all the ratios based on various factors like profitability, revenue and return, etc. most of companies had poor performance ratios. It is also clear than firms, which has more liquidity, and larger firms, which had enough cash, could survive and several small firms which has lower ratios struggled to survive with the financial crisis during 2008-2010.

Impact of the recession on retail sales volumes

https://link.springer.com/content/pdf/10.1057/elmr.2009.140.pdf

Mavis and Craig McLaren published this article in response to Impact of Recession on the retail sales volume in the year of 2009. It compares the retail sales of 2008 recession to the previous ones from 1990’s, the retail sales index (RSI) which is the term used to measure the consumer spending in respect to the national accounts. The RSI index will use to estimate how well the retail sales are doing in the overall economy. During the recessions, the overall GDP contracts along with overall sales economy. This article also explains how the recession impacted food and non-food retails. In 2008 Recession even the food retail sales were decreased rapidly, whereas the non-food retail sales has seen an increase initial months and saw a sharp decrease during the later months and also in the next following year of 2009. Food stores contributed negatively to the retail sales. The price movement has changed drastically especially in the non-food retails such as electronics, clothes and few other areas, the prices has become low and as a result there has been change in the manufacturing goods locations, and moved to low cost areas. The consumer price index has been on the negative side 0% to 5%. The retail sales could have direct impact from the labor household earnings as it derives the demand and sales of the retails. The some retail sales were improved because of lower tax payments and social benefits. However, the overall retails sales had a sharp decrease in the sales, which had a lasting impact on the Retail sales.

Manufacturing employment hard hit during the 2007–09 recession

https://www.jstor.org/stable/pdf/monthlylaborrev.2011.04.028.pdf?seq=1

Megan M. Barker writes this Article for the impact of the Great Recession 2008 in Manufacturing and it effected the employment in various manufacturing businesses. The 2008 recession had a negative impact on the overall employment opportunities, during the initial stage of recession there was only a moderate amount of losses in the jobs and after few month the non-farm unemployment started growing and so with the manufacturing. The rate of unemployment accelerated as months pass by and by the end of 2008 the unemployment rates peaked. The job losses and unemployment in manufacturing sector lasted for more than 18 months. During the period of 2007-2009 almost lost 2 million jobs and that contributes to 15% of the overall industry. In the period of recession apart from the job losses there were several impacts to jobs which were existing like Pay cuts, Reduced Hours and Benefits etc., the one month diffusion index in those times were well below the 50 and continued the same index throughout the recession. This means that they were job losses than creating new jobs or opportunities in the manufacturing field. The overall culture has also changed after the recession many of the manufacturing jobs created in low labor costs areas rather than cities where the high paying jobs has to offer. It almost took more than 3 years to recover from the losses and resources partially and took more than a decade to get back to normal. Based on the historical data it is clear that Manufacturing is one of the most hardly hit industries from the Recession of 2008.

Offshoring of Software Development: Patterns and Recession Effects

https://escholarship.org/content/qt22r9q7wp/qt22r9q7wp.pdf

Kenneth L. Kraemer, Jason Dedrick, Debora Dunkle write this article in collaboration with University of California, Irvine. This article highlights how Recession affected software industry and how it changed the growth of offshoring. Before Recession software development offshoring use to happen only when they don’t have enough resources like tech employee’s and high growth markets or during an expansion of businesses however because of the recession the trend has completely changed to offshoring to location where they can find most of the resources for much lesser costs. Based on the article survey it is evident that the firms, which were having offshoring, had more revenues, employees, able to cut more costs than the non-offshore firms did. In general the recession pressurize the companies to cut costs to increase the chances of survival, and in 2008 recession impacted much worse than expected, the increase in overall costs, lower demands, fluctuations the dollar rate, talent shortages in the field of software development, changes in market demand for the overall sales had a huge impact on software companies. However, companies, which had internal exposure, had little alleviation in the overall company revenues because of more demand on the international sales than just dependent on national sales. Overall, 42% of the companies acknowledged that the impact on the software industry is from low to medium. This shows that overall the international recession is modest. The overall summary based on the provided data it is clear that software industry affected with several job losses, pay cuts etc. and resulted in more offshoring software development.