Economists expect the joblessness that has weighed down the nation’s economic recovery will start to slowly abate in 2010, but they predict consumers will continue to keep a tight rein on spending, according to a new survey.
While signs have pointed to the end of the recession, joblessness remains rampant. The national unemployment rate jumped to 10.2 percent in October, the highest in 26 years. About 9 million people currently receive unemployment benefits.
The November outlook by the National Association for Business Economics, which is set to be released Monday, shows economists expect net employment losses to bottom out in the first quarter of next year. Employers are seen starting to add to their payrolls after that.
“While the recovery has been jobless so far, that should soon change,” said Lynn Reaser, NABE’s president and chief economist at Point Loma Nazarene University. “Within the next few months, companies should be adding instead of cutting jobs.”
But even if companies do start restaffing next spring, they aren’t expected to ramp up hiring very quickly. Some 7.3 million jobs have been lost since December 2007, according to NABE. Of the 48 panelists surveyed, 61 percent do not expect a complete recovery of those lost jobs until 2012. And they expect the unemployment rate will remain “stubbornly high,” averaging 9.6 percent in the fourth quarter of 2010.
Panelists ranked high unemployment as their second biggest concern over the next five years, expressing “extreme concern” first and foremost about the federal deficit. Those surveyed expect inflation will remain low and the dollar to remain weak, though they see it strengthening against the euro and continuing to be a major reserve currency.
