Final answer:
The recession that began in 2007 led to a sharp increase in unemployment, a decrease in household spending by 7.8%, the closure of approximately 170,000 small businesses, and overall economic decline. This period is known as the Great Recession, which officially lasted from December 2007 to June 2009, with long-lasting effects on the U.S. economy and its workforce.
Step-by-step explanation:
The recession that began in 2007 resulted in significant economic challenges across the United States. According to the Bureau of Labor Statistics (BLS), the number of unemployed Americans increased dramatically from 6.8 million in May 2007 to 15.4 million by October 2009. This period also saw the closure of approximately 170,000 small businesses as estimated by the U.S. Census Bureau. Notably, layoffs peaked in February 2009 when employers issued notices to 326,392 workers.
Furthermore, the recession led to a sharp decrease in household spending, which fell by 7.8% due to job losses, declining home values, declining incomes, and overall economic uncertainty. The impact on the economy was further exacerbated as businesses experienced decreased sales and future profit expectations, resulting in a significant drop in stock prices. This combination of factors precipitated massive reductions in incomes, demand, consumption, and employment, culminating in the financial crisis known as the Great Recession.
During the Great Recession, which officially spanned from December 2007 to June 2009, the unemployment rate climbed from 5% to a peak of 10.1%. Even four years after the recession ended, unemployment remained high at 7.6%, with 11.8 million people still jobless. The economic downturn necessitated quick responses from Congress, the President, and the Federal Reserve, leading to interventions such as the American Restoration and Recovery Act aimed at stabilizing the economy and assisting affected individuals through tax credits for homebuyers, cash incentives for car purchasers, and extended unemployment benefits.