GDP Is Up ... But Employment Recovery May Be Years Away
by Lee McPheters
Economists, Wall Street, and the general public were pleased with the advance report on third quarter Gross Domestic Product (GDP) from the U.S Bureau of Economic Analysis. The consensus expectation as posted on Briefing.com was an annualized increase of 3.2 percent. The advance report from the BEA was higher, at 3.5 percent. This is the largest consumer spending increase since 3.7 percent growth was posted in the first quarter of 2007, well before the recession began. However, it is likely that unemployment and job losses will persist for some months to come.
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Western Region Accounts for 5 of 10 Weakest State Labor Markets
by Lee McPheters
For the first time in the recession, all 50 states lost jobs over the year in September. Before the latest figures were released, North Dakota had continued to add jobs year over year, albeit at a slowing pace. But the September numbers show North Dakota non-farm jobs declining by 300 compared to a year ago. Nationally, the economy lost 5.8 million jobs over the year, a decrease of 4.2 percent.
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Consumer Spending and the 'New Normal' Economy
by Lee McPheters
Economists, sociologists and other observers are divided in their view of consumer spending in the post-recession era that lies (somewhere) ahead. While there is little controversy about the short term outlook -- the dominant consensus is that consumers will spend less and save more -- the opinions of analysts diverge for the years after 2010. Some believe that consumer spending will show considerable strength as unemployment rates fall and consumers move to replace ageing durable goods such as autos and appliances. The alternative view is that the current contraction has been a "game changer" for consumers. High unemployment rates, foreclosures and tight credit markets have combined to bring a permanent new frugality to consumer behavior that will linger for years, bringing a "New Normal" economy with a reduced emphasis on the consumer.
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Every Western State Expected to Lose Jobs This Year
by Lee McPheters
Employment figures from the U.S. Bureau of Labor Statistics for the year through August show that every Western state lost jobs compared to the same eight-month period last year. Nationally, nonfarm employment through August was down by -3.7 percent. Several Western states (led by Wyoming) saw milder job losses. But California, Idaho, Oregon, Nevada and Arizona all have lost jobs at a faster pace than the nation on a year-to-date basis through August.
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Phoenix Real Estate Outlook: Residential Recovering in 2010, but Commercial Continues to Slide
Forecasts by the Greater Phoenix Blue Chip real estate consensus panel show that perceptions of the metro real estate market continued to deteriorate in the third quarter of 2009. Projections for residential development are less optimistic than for second quarter, but even so, this sector is on its way to becoming a positive force in the economy. On the other hand, the commercial sector is sliding toward a hole.
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Recession Aftermath: A Tentative Scenario
by Lee McPheters
The near-term outlook for the national economy continues to improve, but full recovery will be slow in coming. After decreasing this year, Gross Domestic Product (GDP) is expected to grow next year, but hundreds of thousands more jobs will be lost and unemployment will increase into 2010. U.S. nonfarm jobs will not grow for the year as a whole until 2011, and it will take another two years to finally get employment rolls back to the level recorded in 2007. In all, economic problems are expected to extend in varying degrees of severity for several more years.
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