It’s widely accepted in the United Kingdom that the United States has had a better economic recovery. There are a bunch of pet theories for why that is: The idea that the US government was happier spending to ensure the recovery, or that the UK is hamstrung by European stagnation, are two of the most popular.
But it’s not clear that there really is a gap between the two recoveries any more.
Both the Office for National Statistics (ONS) and the Bureau of Economic Analysis (BEA), the respective UK and US statistical agencies, made GDP revisions in the last week, and combined they have changed the picture of what happened in the last few years.
You can see the US and UK GDP performances on the chart below, with the dashed lined representing pre-revision paths for GDP. As you can see, the US has been revised down and the UK has been revised up.
There’s still a considerable gap between the US and UK stories — the British recession was considerably deeper, and that’s reflected in the GDP levels you can see today.
The graphs end up a similar shape, but the initial dip is much greater in the UK. In both cases, the trough of the economic contraction on both sides of the Atlantic happened in the second quarter of 2009. After that, recoveries began.
But once that difference in recession depth is accounted for, the picture is different. Here’s how it looks when it’s indexed to the second quarter of 2009:
Once you look at only the post-recession recovery, the difference between the two (which was visible in the old data) has now disappeared. Back in 2011 and 2012, the US genuinely was opening up a gap in comparison to the UK, which is even wider by the old measurements.
But as you can see, the BEA is now saying that the US economy’s growth in 2013 was feebler than expected, while the UK’s stagnant 2011-2013 period wasn’t nearly as bad as believed at the time.
And combined, those two things mean that since some time in 2014, average post-recession growth in the US and UK has been practically the same.
Now, that doesn’t mean that the UK has done as well as the United States — a deeper recession means it’s still considerably smaller against its pre-crisis level than the US.