Economists see mild growth next year

Panel says jobless rate won't budge

Tribune Washington BureauDecember 18, 2012 

WASHINGTON — Most forecasters are looking at 2013 as being another mediocre year for the economy, but many appear hopeful that growth will accelerate as the year progresses.

Beyond that broad outline, the outlook for next year is muddled. The range of economic growth projections is about as wide as it's ever been, reflecting the great fiscal haze hanging over the nation.

In its year-end survey released Monday, the National Association for Business Economics said the consensus view from its panel of forecasters shows gross domestic product expanding next year at an average annual growth rate of 2.1 percent. That's little changed from the modest 2.2 percent pace this year.

And don't expect the unemployment rate to budge. Most of these 48 professional economists see the jobless rate averaging 7.7 percent in 2013 — exactly where it stands now.

These numbers represent the consensus or median, which means half the experts are predicting GDP growth stronger than 2.1 percent next year and half predict growth below 2.1 percent. But what's striking about this year's survey results are the varying views from these economists, who work at companies, universities and government.

Although they predict GDP to grow in the fourth quarter of 2013 from the same period in 2012, five of the forecasters on the panel think growth will come in at 3.6 percent, while another five expect the increase to be a mere 1.3 percent.

The top and bottom range of forecasts for job growth is just as stark. Some see the nation adding on average 300,000 jobs a month in the second half of next year, but the pessimistic five believe payrolls will rise by no more than 125,000 a month in that period.

"It just shows there's a lot of uncertainty among economists," said Nayantara Hensel, chair of the association's outlook survey and professor of industry and business at National Defense University.

Hensel points out concerns and uncertainty over the looming fiscal cliff already have taken a big bite out of business investments and are weighing on consumers as well, especially those who work in government.

"It's not clear what's coming in the new year," she said. "Is there going to be a furlough? Are government funds not going to be cut? We don't know."

She added: "Personally, I believe we're going to have a recession."

Lexington Herald-Leader is pleased to provide this opportunity to share information, experiences and observations about what's in the news. Some of the comments may be reprinted elsewhere in the site or in the newspaper. We encourage lively, open debate on the issues of the day, and ask that you refrain from profanity, hate speech, personal comments and remarks that are off point. Thank you for taking the time to offer your thoughts.

Commenting FAQs | Terms of Service