Economists surveyed in the latest Wall Street Journal forecasting survey expect the recession to end in September. However, the majority also believe that the economy will not begin to grow until the second half of 2010, which is when they expect the unemployment rate to go down.
Many economists surveyed by the Wall Street Journal predict the labor market will remain weak. Just 12 percent of the economists expect the unemployment rate to fall this year. More than one-third of respondents expect the jobless rate to peak in the first half of 2010, while about half don’t see unemployment declining until the second half of 2010. The economists do see the rate of decline slowing, forecasting 2.6 million job losses in the next 12 months, compared with 4.8 million jobs lost in the previous period. According to Joseph Lavorgna of Deutsche Bank Securities Inc., the economy would have to grow an average of about 4 percent for six years to get back to the sub-5 percent unemployment rates seen in 2007.
Economists are seeing more signs of a recovery in the broader economy this year. On average, the economists expect the recession to end in September, compared with the October forecast last month. This marked the first time since the start of the recession that the economists didn’t push the date of recovery further into the future.
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