With interest rates so low, we are not well positioned to respond to negative shocks, whatever the source. Longer-Run Challenges Productivity and Growth Let’s turn to longer-run challenges, and start by asking why growth has been so slow, and how fast we are likely to grow going forward. This next slide shows the fiveyear trailing average annual real GDP growth rate (figure 8).
By this measure, growth averaged about 3.2 percent annually through the 1970s, the 1980s, and the 1990s. But growth began to decline after 2000 and then nose-dived with the onset of the Global Financial Crisis in 2007 and the slow expansion that followed.