Experts Predict Continued Slow Growth For Mississippi EconomyBy Jeffrey Hess | Published 28 Sep 2011 03:50pm |
Economic experts are predicting continued sluggish growth for the Mississippi economy. MPB's Jeffrey Hess reports that the state is not expected to get back to pre-recession employment for at least 4 more years.
What recovery had been in place following the recent recession has stalled, setting up several more years of slow growth and the potential for another recession...that's according to Greg Daco, an economist with the firm IHS global Insight.
"It means that the unemployment rate will not decrease very fast. We don't see that employment rate falling very fast because there is weak economic activity. And in this frame work, businesses are unlikely to hire more employees because they see low demand, so they don't really have a need for increased hiring," Daco said.
Daco says there is a 40-percent chance of another recession which could be triggered by the problems in Europe, sudden price shocks, or an end to the payroll tax cuts or unemployment benefits further decreasing demand. Senior state economist Marianne Hill says the health of the national is deeply important to the state economy.
"Employment trends in Mississippi are very closely linked to what is happening nationally. It is just that the sectors in Mississippi are somewhat different that what you have nationally. We have a greater important here on manufacturing than in the rest of the country, for example," Hill said.
Mississippi has had a number of high profile manufacturing plants open up in recent years, and Jay Moon with the Mississippi Manufacturers association says that is important for the recovery because 12-percent of the state work force is in manufacturing.
"There is another 2 to 3 jobs that are created for every direct manufacturing job. So in a state like ours that has about 1.3 million people that are working at any one point in time, that is about 300-thousand jobs. That is a lot of jobs," Moon said.
This year new home starts are expected to be half their traditional rate, but Marty Milstead with the Home builders Association of Mississippi says it will take an increase in jobs to energize other parts of the state economy, like home building.
"In the past, housing has moved the economy. But right now we have to have some jobs to create a demand there. So you could go build the houses, but if people don't have the jobs they are not going to be able to buy them," Milstead said.
The news wasn't all bad....Milstead and economist Daco both predict that the long recession has also led to a pent-up demand that once released could greatly benefit the speed of the recovery.
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