Forecasters See Anemic Recovery in ’92 : Economy: The National Assn. of Business Economists cited the high level of debt, which has discouraged consumers.

The economy will crawl out of its recession at a lackluster pace but once it does, it will not fall back, a group of private economists predicted Monday.

In a survey of 49 professional forecasters, the National Assn. of Business Economists said the median prediction was for an anemic economic growth rate of 0.5% in the first three months of 1992 and an average 1.5% pace for the entire year.

The main reason cited for the weak recovery was the high level of debt, which has discouraged consumers from taking out new loans to buy cars, houses and other “big-ticket” items that would help stimulate business activity.

The group’s growth expectations are less than half as robust as the average postwar recovery and significantly lower than in previous surveys.

In an August survey, the median forecast was for a 2.5% economic growth rate for the first quarter and an average rate of 2.6% for the year.

After contracting sharply in late 1990 and early 1991, the economy has been expanding modestly since last April in what some economists call a “growth recession.”

The government has estimated that the economy barely moved forward at a 0.3% annual rate in the last quarter of 1991. For the year the economy shrank 0.7%.

Although nearly all the economists expect a subdued recovery, only 8% of respondents in the survey expect the economy to fall back into recession within the next year. The survey was conducted in late January and early February.

The economists do not expect the tepid growth to provide quick relief in the job market. The average jobless rate is expected to rise to 6.9% for all of 1992 from an average 6.8% last year. The unemployment rate for January was 7.1%.

Inflation, on the other hand, is expected to remain under control, with interest rates low. Housing starts are seen making a modest recovery this year.

Last week, Federal Reserve Board Chairman Alan Greenspan said he has grown “somewhat more optimistic” about the economy in recent weeks and expects a moderate upturn to start in the second quarter.

A majority of the economists surveyed oppose efforts to stimulate the economy with tax cuts or spending hikes, including the economic program proposed by President Bush in his State of the Union address last month.

“Doing nothing would show a sign of leadership,” NABE President Lynn Michaelis told a briefing for reporters.

But if Congress and the White House do adopt an economic package, the economists favor a capital gains tax cut, an investment tax credit increase, increased public works spending, higher gasoline taxes and elimination of taxes on dividends.