CBO: US growth potential shifts to lower gear

November 15, 2012 02:26

WASHINGTON - The US economy is recovering at an agonizingly slow pace largely because its potential growth rate has been stunted by structural shifts to its workforce and a dearth of investment, the non-partisan Congressional Budget Office said on Wednesday.

In a new report that offered a gloomy outlook for US growth prospects, the CBO said the cumulative rate of growth in US output since the end of the recession in 2009 was running nearly nine percentage points below the average for previous recoveries.

The non-partisan congressional budget referee attributed two thirds of this phenomenon to a reduction in the potential growth rate -- the amount that gross domestic product could expand if conditions were right.

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