BOSTON (AP) – New England will lag the nation in economic growth through 2010, with New Hampshire and Massachusetts posting the region’s fastest growth, a regional forecast organization predicted Tuesday.
The New England Economic Partnership said none of New England’s six states is expected to exceed the nation in job, income and overall economic growth over the next four years, a trend in line with the region’s generally lagging performance in recent years.
The forecast group also cautioned that the latest of its twice-a-year forecasts is more speculative than usual, given uncertainty about the duration of the current housing slump that has sent home prices slightly downward in many areas.
“There is a relatively high downside potential of the forecast, mostly influenced by uncertainty in the housing market,” Ross Gittell, the organization’s forecast manager, said in remarks prepared for the forecast’s release at a conference in Westborough. “A weaker and longer-to-recover housing market nationally and in the region than that in the forecast would have a significant negative influence on the New England regional economy.”
Employment in New England is expected to grow at an average rate of 0.8 percent per year through 2010, below the forecast of 1.3 percent per year for the nation. The region’s jobs total, which hit a historic peak of 7.083 million in early 2001, isn’t expected to return to that level until the fourth quarter of 2008. The forecast organization had predicted in May that the regional job total would reach that threshold slightly earlier, by the third quarter of 2008.
However, the projected regional job growth would reverse a 0.3 percent jobs decline in New England in the 2000-2005 period.
New England’s overall economic activity – measured by gross product, the value of all goods and services produced within the region – is expected to grow at an annual average of 2.3 percent through 2010.
compared to the projected growth rate for the nation of 3.2 percent.
Regional per capita income growth is expected to lag the nation at 2.5 percent per year compared with 3.4 for the nation, according to the 35-year-old nonprofit forecast organization, whose members are from private industry, government and academia.
In its previous forecast issued in May, the forecast group predicted New Hampshire, Connecticut and Vermont would be the pacesetters for New England’s slow-growing economy through 2010, with Maine, Massachusetts and Rhode Island bringing up the rear.
The new forecast again ranks New Hampshire highly, but says the outlook is improved for Massachusetts, which has lagged the region’s growth in recent years but is now expected to exceed it through 2010.
The region is still trying to shake off aftereffects of recession that began in 2001 and persisted longer in New England than in the rest of the nation. 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.
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