Economy shows slow signs of improvement

The U.S. economy is showing signs of climbing out of the worst of the recession, with the latest government estimates indicating an annual rate of decline of 1 percent between April and June.

Though still a decline in gross domestic product (GDP) — the overall output of the economy — the rate was much lower than during the height of the financial crisis at the end of 2008 and during the first quarter of this year.

During the last three months of 2008, the rate was 5.4 percent. At the beginning of this year it was 6.4 percent, according to Commerce Department statistics released Friday.

Economists date the recession to December 2007, and while the latest numbers suggest an easing, the unemployment rate continues to rise, leaving millions of Americans out of work.  The Federal Reserve expects unemployment to remain between 9 and 10 percent through the end of 2010.

Democrats and Republicans will continue to clash over whether government efforts to shore up the economy, particularly the $787 billion stimulus package passed earlier this year, have helped.

House Minority Leader John BoehnerJohn BoehnerClinton maps out first 100 days The Hill's 12:30 Report Boehner on Cruz: 'Lucifer is back' MORE (R-Ohio) said Friday's numbers are still an indication of economic worries.

"Today’s economic report is yet another reminder that middle-class families and small businesses are still hurting and looking for better solutions than what Washington Democrats have offered this year," BoehnerJohn BoehnerClinton maps out first 100 days The Hill's 12:30 Report Boehner on Cruz: 'Lucifer is back' MORE said in a statement. "More spending does not mean more jobs, and bigger government does not mean a better economy."

Commerce Department statistics show, however, that a big change between the first and second quarters was the amount of government spending.

The federal government spending increased to nearly 11 percent between April and June, compared with a decline of 4.3 percent in the previous quarter. The $787 billion fiscal stimulus package was signed into law in the middle of February and continues to ramp up.

The left-leaning Economic Policy Institute (EPI) said the stimulus package gave a "significant boost to growth" in the second quarter.

"Although the recovery act wasn't enough to push economic growth rates into positive numbers, it most likely added 3 percentage points to GDP growth, which, in turn, likely created or saved around 720,000 jobs," EPI said in a statement.