Wed, November 11, 2009
New England Economy: Not Out of the Woods in 2010
Yesterday the New England Economic Partnership (NEEP) held its Fall Economic Conference at the Boston Federal Reserve. Regional economists reported that they expect unemployment in New England to peak next year, despite improvements in the national economic outlook.
For personal reasons I wasn’t able to attend yesterday’s conference, but WBUR reporter Curt Nickish provided a nice summary on this morning’s news. New England could lose another 100,000 jobs through next year before employment is expected to turn around late next year.
Commercial real estate has not yet hit bottom, so banking and financial sectors still have some pain ahead. With widespread uncertainties about employment and households feeling poorer than they did a year ago, consumers are likely to be cautious about buying, so consumer sectors are likely to take take a while to bounce back.
NEEP economists believe that the Massachusetts housing market has hit bottom, with single-family home affordability back at the levels of the mid-1990’s That still puts home-buying out of the reach of many middle-class households, but allows some potential buyers back into the market. Employment in the state is not expected to recover to pre-recession highs until well into 2013. Health care, higher education, and the technology sector are expected be the state’s major sources of recovery in the near future.
In Rhode Island, where unemployment reached 13% in September, the picture remains bleak. Edward Mazze, Distinguished University Professor of Business Administration at the University of Rhode Island, noted that “The creation of jobs and solving the [state] budget deficit problem once and for all are the major economic issues Rhode Island faces as it enters 2010.”
An AP summary of the conference is available online, and eventually the presentations from the meeting should be available at the NEEP site.
