Unemployment is going down and new jobs are being created. But this has happened before in this economy and the job gains didn't last. Here's a list of why the recent job gains might last, according to the Associated Press.
The housing bubble bursting is the core of the nation's economic woes. Home prices have dropped 30 percent since 2006, which has resulted in a loss of $7 trillion of homeowners' equity. But there are tentative signs the housing market is healing. Once home prices become stable, more people will decide to buy.
During and after the Great Recession, companies minimized the size of their work forces because demand plummeted. After demand started to pickup, companies did more work with the employees they already had. But the more demand grows, the more employees companies will have to hire because more can only be done with less to a certain point.
Since the recession, people have raised their savings and reduced their debt. Debt payments as a percentage of after-tax income, a good measure of household burdens, is at its lowest point since 1994.
The showdown on the debt ceiling last summer shook confidence in America's leadership, as it looked like the U.S. might default on its debts for the first time. Since that time, tensions in D.C. have eased. Lawmakers from both parties supported a bill to help small businesses get financing to hire more people and grow.
The Great Recession resulted in a drought of tax revenue for state and local governments. Many were forced to lay off teachers and other workers in the public sector. But state governments have added 10,000 jobs this year, and local governments added 2,000 jobs last month.
Many investors worried that Greece and other European nations would default on their debts, leave banks with huge losses, resulting in a global credit crunch. But Greece got a $172 billion bailout, pushing the fear of default back. The European Central Bank has made over $1.3 trillion in low-rate three-year loans to banks since December.
After Lehman Brothers collapsed in 2008, banks greatly reduced loans to businesses in 2009 and 2010. But banks are doing better now. Bank lending to businesses grew by 14 percent last year to $1.35 trillion. Economists are still cautious but say the labor market has gained enough momentum to avoid a repeat of mid-2011's drop.