University of Central Florida economist, Sean Snaith says that although the recession is dead, the drumbeat of mounting job losses will continue.
In Snaith’s Halloween-themed forecast for Florida, he says that the unemployment rate will peak above 11 percent next year, as several sectors including, manufacturing and housing, will continue to struggle for longer that those at the national level.
Snaith projects that employment will not return to pre-recession conditions before 2014.
“The job market will haunt us for years after the recession has ended,” Snaith said. “As we saw during the boom, strong growth can quickly and dramatically ratchet down the unemployment rate, but a weak recovery just prolongs our pain.”
The October Report produced by the Institute for Economic Competitiveness of the University of Central Florida, provides projections for Florida and its 12 metropolitan regions. These are: Naples, Daytona Beach-Deltona, Gainesville, Ocala, Lakeland, Palm Bay-Melbourne, Pensacola, Miami, Jacksonville, Tallahassee, Tampa Bay and Orlando.
The Report released today, coincides with a release from the U.S. Commerce Department which indicates that the US economy grew by 3.5 percent in the quarter ending September 2009. Snaith believes that this is temporary, though.
“I still believe that this recovery will be shaped like a gravy boat with growth gradually recovering, like the dish’s tapered spout,” he said. “Today’s GDP figures are just lumps in the gravy that will give way to weaker growth in the quarters to come.”
See other highlights from the Report below:
- Florida’s massive job losses will continue to accumulate through the end of 2009. After nearly three straight years of job losses, meager employment growth returns in the 2nd quarter of 2010.
- Payroll employment in Florida will have declined by 719,000 jobs from 2007 Q1 through 2009 Q4.Paltry job growth reappears in Florida in 2010. Year-over-year job growth remains negative until the 4th quarter of 2010.
- Payroll job growth year-over-year is expected to average 1.7% in 2011, 2.9% in 2012, and 3.2% in 2013.It will be 2014 before payrolls recover to their pre-recession levels.
- Florida’s labor market will continue to bother the state’s economy. Atonement perhaps for the sins of the housing market? Florida’s payroll employment will not reach pre-recession levels until the first quarter of 2014.
- Unemployment rates, already in double digits, continue to slowly climb into 2010 with average unemployment unemployment peaking at 11.2%. Unemployment will stay above 10% through 2012 Q1 and then continue a painfully slow decline from its peak.
- Unemployment will still be stubbornly high by the end of 2013 averaging 8.4% in the 4th quarter.
- The sectors forecasted to have the strongest growth during 2010-2013 are Professional and Business Services (5.9%) Education and Health Services (2.2%) and Trade, Transportation and Utilities (2.2%).
- Florida’s population is expected to decline again in 2009 and stay flat in 2010 before in-migration picks up and population growth slowly climbs to 1.5% in 2013.
- Florida’s housing construction sector finally bottoms out deeper than many expected in 2009, falling to an annual rate of roughly 25,000 housing starts. Housing starts will climb over the next several years. In 2013, housing starts will recover to 2001 levels, rising gradually to 170,000 starts.
- Sales of existing homes have shown strength in recent months as the 12-month moving average of sales has been on the rise since August 2008. However, prices are still struggling to find a bottom, and until this occurs, we will still have instability in the housing sector.
- Real Gross State Product (GSP) growth was near zero in 2007 and contracted in 2008 at -1.6%. Growth will be strongly negative in 2009, with the economy contracting at -3.1% before expansion
reappears in 2010, accelerates to 4.5% in 2012, and eases to 4.1% in 2013.
