By the end of next year, the unemployment rate will be at 7.5%. Consumer spending will be up, as will housing starts. But first, the economic recovery needs to slog its way through the remainder of 2012, economists said.
Monthly non-farm job growth will grow to 188,000 a month by the end of this year, up from 115,000 in April. That will cause the jobless rate to slide minimally to 8% by the fourth quarter from 8.1% now, according to a survey of 54 economists by the National Assn. for Business Economics.
If the forecasts are accurate, the job market could be headed for an upswing after slowing growth in March and April reversed a winter trend of gains averaging 252,000 added jobs a month.
Expectations for consumer spending, housing, vehicle sales and industrial production are all up, though economists think the growth will be stronger after the November elections.
The survey found that the auto market is gearing up for 14.5 million unit sales this year — which would make 2011 the best year since 2007. Housing starts will increase to 720,000 this year before soaring to 850,000 next year, in what could be the busiest building year since 2008, according to the outlook.
Overall, the U.S. will grow at a modest 2.3% rate this year before expanding 2.7% next year, according to the NABE predictions.