Economists foresee weak but improving growth
Economists foresee only tepid growth for the coming year, with unemployment back above 8 percent for the first half of 2013.
The good news: The housing market is recovering faster than expected, and the economy likely won’t fall off a “fiscal cliff.”
The quarterly survey by the National Association for Business Economists released today predicts growth will be weak overall but should accelerate slowly through 2013.
The 44 economists surveyed now see gross domestic product — the value of all goods and services produced in the United States — rising just 1.9 percent in 2012 before reaching a 3 percent pace by the fourth quarter of next year.
Employment growth is forecast to weaken. The panel predicts that the unemployment rate will rise to 8.1 percent by the end of the year. The economy should add an average of 125,000 jobs per month during the fourth quarter, down from the economists’ May forecast of 190,000 jobs.
The unemployment rate, the most-watched measure of the country’s economic health, has been a prime issue in the presidential election campaign. It fell to 7.8 percent in September. But before that, the rate was 8 percent or higher for 43 months, a streak that Republican challenger Mitt Romney had been emphasizing in his effort to unseat President Barack Obama.
The NABE survey results hint at the possibility the rate could rise back to the 8 percent level when the October jobs report comes out Nov. 2, four days before the election.
The organization is made up of business economists and others who use economics in the workplace.