Output at factories, mines and utilities fell 0.2 percent, the first decline since the recession ended in June 2009, according to figures from the Fed today. Another report showed builders were less pessimistic than projected this month. [...]

Economists forecast production would increase 0.2 percent, according to the median of 63 projections in a Bloomberg News survey. Estimates ranged from a decrease of 0.3 percent to a gain of 0.4 percent. The drop followed an unrevised 0.2 percent gain in August.

It isn’t good to read too much into any one month’s data. But why might this piece of bad news be particularly bad?

Because industrial production — manufacturing, mining and utilities, often seen as a economic bellwether — had previously seemed a bright spot in an otherwise gloomy economy. Total levels of production plummeted back to 1998 levels during the recession. But they bounced back quickly, as companies restocked their shelves and upgraded their equipment during the recovery.

Now, economists would expect the consumer to step in: Customers buy more goods, meaning businesses order more goods, meaning manufacturers make more goods, hiring workers in the process. But that hasn’t happened. The regular Main Street consumer remains constrained by high levels of unemployment and stagnant wage growth. So overall production has stalled out as well, and industrial producers see no need to add jobs. It’s just one more example of the sluggish overall picture.

What’s most frightening is just how much lower-income Americans have pulled back: Your average earner is now spending less than half per day what he spent in May 2008, and 20 percent less than he spent a year ago. Those are really massive cuts.

Given that consumer spending makes up about 60 percent of the U.S. economy, that does not attest just to how hard the middle class has taken the recession, but to how hard it will be for the recovery to take hold. Until consumers spend more, employers won’t hire. But if employers won’t hire, consumers can’t start spending more. That is the horrible pretzel logic of the current economic situation.

That means little to the 14.9 million Americans out of work, of course. Unemployment tends to lag recessions, meaning that it takes some time for businesses to rehire workers after an economic shock, and in 28 percent of U.S. households, one member is still seeking a full-time job.

But how long until businesses start hiring again? Yesterday, the Center on Budget and Policy Priorities put out this ominous chart:

As the chart shows, it might take months and months for the economy to return to full employment. In reality, the chart is not quite ominous enough: Most economic evidence implies that the United States won’t return to an unemployment rate in the five percent range for years and years. Economists at the Kansas Fed examined the phenomenon in a paper called “How Will Unemployment Fare Following the Recession,” released at the end of last year.

First, they note that after deep recessions, the U.S. economy tends to rebound quickly. Why? Businesses initially react strongly to the bad recession, laying off workers, producing fewer goods, and selling off their inventories. When demand returns, those businesses need to hire workers and produce a lot of goods again, and fast, to keep up.

But, unfortunately, that dynamic has not been true for the recent recessions. Businesses lay off workers and stop producing goods as the recession hits. But when the recovery happens, businesses just make do with less — adding hours to existing workers, and rebuilding inventory slowly. This produces the “jobless recoveries” you hear about.

Moreover, recoveries tend to take longer after recessions paired with banking crises, like the Great Depression. And, yes, this recession kicked off with a massive meltdown on Wall Street, followed by woes in the commercial banking sector and the collapse of hundreds of small banks.

What does that mean? Years until employment recovers. By the Fed economists’ projections, the U.S. unemployment rate should hit 6.5 percent — a still-elevated rate — in 2018.

The Business Cycle Dating Committee of the National Bureau of Economic Research met yesterday by conference call. At its meeting, the committee determined that a trough in business activity occurred in the U.S. economy in June 2009. The trough marks the end of the recession that began in December 2007 and the beginning of an expansion. The recession lasted 18 months, which makes it the longest of any recession since World War II. Previously the longest postwar recessions were those of 1973-75 and 1981-82, both of which lasted 16 months.

In determining that a trough occurred in June 2009, the committee did not conclude that economic conditions since that month have been favorable or that the economy has returned to operating at normal capacity. Rather, the committee determined only that the recession ended and a recovery began in that month.

A recession is a period of falling economic activity spread across the economy, lasting more than a few months, normally visible in real GDP, real income, employment, industrial production, and wholesale-retail sales. The trough marks the end of the declining phase and the start of the rising phase of the business cycle. Economic activity is typically below normal in the early stages of an expansion, and it sometimes remains so well into the expansion.

Of course, the fact that the recession technically ended means little to the millions of businesses and workers still suffering. But now we can officially gauge how far behind economic growth the labor-market recovery is trailing:

Employment never returned to where it was after the eight-month 2001 recession, caused by the stock and tech bubbles: The unemployment rate continued to tick up for two years after that recession’s technical end, and dwindled down only slowly. And now, the jobs gap is even greater.

Obama said his administration is considering new measures to help gin up the stalled recovery:

[My] administration remains focused, every single day, on pushing this economy forward, repairing the damage that’s been done to the middle class over the past decade, and promoting the growth we need to get our people back to work.

So, as Congress prepares to return to session, my economic team is hard at work in identifying additional measures that could make a difference in both promoting growth and hiring in the short term, and increasing our economy’s competitiveness in the long term. Steps like extending the tax cuts for the middle class that are set to expire this year. Redoubling our investment in clean energy and R&D. Rebuilding more of our infrastructure for the future.  Further tax cuts to encourage businesses to put their capital to work creating jobs here in the United States. And I’ll be addressing these proposals in further detail in the days and weeks to come.

But he focused on berating Republicans for obstructionism:

[This small jobs] bill has been languishing in the Senate for months, held up by a partisan minority that won’t even allow it to go to a vote. That makes no sense. This bill is fully paid for. It won’t add to the deficit. And there is no reason to block it besides pure partisan politics.Small business owners and the communities that rely on them, they don’t have time for political games. They shouldn’t have to wait any longer. In fact, just this morning, a story showed that small businesses have put hiring and expanding on hold while waiting for the Senate to act on this bill. Simply put: holding this bill hostage is directly detrimental to our economic growth.

So I ask Senate Republicans to drop the blockade. I know we’re entering election season. But the people who sent us here expect us to work together to get things done and improve this economy.

The problem is, Republicans have no real incentive to drop the blockade, no matter how much Democrats wish they do. If the economy starts improving due to Democratic policies, that’s better for Democrats. If the economy falters, that’s better for Republicans. Voters might despise both parties for all the partisan bickering stalling important measures, such as Medicaid funding or aid for the 99ers. But they’ll vote out the party in power and, therefore, responsible.

The Bureau of Economic Analysis knocked 0.8 percentage point, about $25 billion, off of the GDP figure to account for an upward revision to imports and a downward revision to exports and private inventory investments — essentially, business restocked and rebuilt a bit less than the government first guessed.

The numbers give context for a major speech by Ben Bernanke, the head of the Federal Reserve, at 10 a.m. Speaking at a conference, Bernanke might outline new policy measures by the Fed to gin up recovery. The slow pace of GDP growth implies a strong stall-out and poor job growth for the remainder of the year.

Thus, the stall-out that started in January continues, with employers continuing to avoid hiring and large number of people losing their jobs.

Continuing unemployment claims declined slightly. But extended benefits swelled by 1.3 million, in response to Congress reauthorizing a federal extension at the end of July, restoring unemployment insurance benefits to millions who had lost them starting June 2.

Economists believe that initial claims need to fall well into the 300,000s to make a dent in the unemployment rate, which itself remains elevated and would be higher were it not for drop-outs from the labor force. The stall-out in the labor market recovery is discomfiting, and the picture seems to be getting worse, rather than better.

Heidi Shierholz, an economist with the Economic Policy Institute, gave this flash analysis of the numbers: “The net loss of jobs reported in today’s employment report captures a job market stuck in neutral. Roughly one in six workers are either unemployed or underemployed, and the labor force continues to decline. It is time for the government to do substantially more to create jobs so the backlog of unemployed workers can get back to work.”

The number of new jobless claims has not fallen since the beginning of the year, indicating a stall-out in the recovery and implying a steady, high unemployment rate.