WESTBOROUGH, Mass. (AP) – Connecticut, New Hampshire and Vermont will be the pacesetters for New England’s slow-growing economy through 2010, with Maine, Massachusetts and Rhode Island bringing up the rear, a regional forecast organization predicted Thursday.

The New England Economic Partnership said New Hampshire will be the only state in the region to post faster job and overall economic growth than the nation through 2010, while Connecticut will lead the six-state region for growth in personal income and gross state product.

Vermont is forecast to fare slightly better than the region as a whole by most economic measures. Massachusetts will continue lagging the nation and the region in employment growth, with Maine suffering continued erosion in manufacturing jobs and Rhode Island’s economy slowing after recent growth.

The forecast group says the recent slowdown in New England’s housing market will persist, with prices expected to appreciate an average of less than 1 percent through 2010.

The nonprofit organization, which issues economic forecasts twice a year, offered a slightly more pessimistic outlook for New England’s job growth than it predicted in last fall.

Total New England employment isn’t expected to return to its first quarter 2001 historic peak of 7.083 million jobs until the third quarter of 2008, compared with the previous forecast to reach that milestone in this year’s second quarter.

“The forecast is for a slightly weaker and slower-growing overall economy,” Ross Gittell, the organization’s forecast manager, told about 150 economic and business leaders at the group’s spring conference in Westborough.

Gittell, a University of New Hampshire economist, said expectations are lower because unemployment has climbed higher than forecast, fewer people are moving into the region, and New England’s manufacturing sector and its leisure and hospitality businesses are lagging.

“There’s little hope of a manufacturing employment recovery,” Gittell said. “Those jobs are not going to be recovered.”

Job growth is forecast to average 0.9 percent per year through 2010 in New England, compared with a 1.3 percent gain forecast for the nation. Still, the regional job growth reverses a 0.3 percent jobs decline in New England in the 2000-2005 period.

The recession that began in 2001 persisted longer in New England than in the rest of the nation, and recovery has come more slowly. After eight consecutive quarters of declines beginning in 2001, the number of jobs in the region finally began to increase in the second quarter of 2003.

Housing prices continued to climb in New England during the recession, and have risen well above the national average in recent years. But that is quickly changing. The forecast organization predicted housing price growth will decline from an annual average of more than 10 percent in 2000 to 2005 to less than 1 percent through 2010.

U.S. housing prices are forecast to rise 3.2 percent per year through 2010.

New England’s gross product – the value of all goods and services produced within the region – is expected to grow at an annual average of 3 percent through 2010, slightly behind the nation’s projected growth rate of 3.1 percent.

The only New England state expected to experience housing price appreciation at a rate higher than the nation’s is Vermont.

The three states with the highest recent increases in housing prices – Rhode Island, Massachusetts and New Hampshire – are expected to have the slowest growth in housing prices, with Rhode Island expected to experience a slight decline through 2010.

New England’s growth will exceed the 2.4 percent growth rate that the region experienced during the decade’s first half, but fall short of the 5.5 percent growth in the last half of the 1990s, according to the forecast organization, whose members are from private industry, government and academia.

New England’s gross product growth is forecast to be uneven, rising at a rate below the national average this year but above the national figure starting next year.

On the Net:

New England Economic Partnership: http://www.neepecon.org

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