29 September 2020

Economic Recovery On Slow And Steady Pace

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After a positive job report for February, optimism drove markets upward but the report only looked good because economists had been forecasting weaker numbers due to the harsh weather. The recovery appears to be on track, albeit on a slow and steady path.

The job market was adding an average of 205,000 jobs a month in the year leading up to this winter. Economists are hopeful we'll get back to that pace soon and look for broader economic growth this spring.

Speaking at a Wall Street Journal event Thursday, New York Fed President Bill Dudley said he believes the harsh winter will shave as much as a whole percentage point off the economy's growth rate in the first quarter. But after that, the economy should bounce back because the drag from federal spending cuts is declining, household finances are improving and companies are awash in cash, he said.

Dudley predicts that the economy will grow around 3% overall this year. The last time the economy grew that fast in a calendar year was 2005. While growth at that rate is considered solid, it's not gangbusters. And it's too slow for many Americans.

About 3.8 million workers have been unemployed for six months or more -- and that number doesn't count workers who have given up on their job searches.

Construction was the hardest hit sector in the recession. It has yet to stage a major comeback, despite the housing recovery. About 2.3 million construction jobs were wiped out between 2006 and 2011. Since then, only about 1 in 5 of those jobs have returned.

Click here for the original article from CNNMoney.

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