Although the recession is over, job losses will haunt Florida for another four years, according to the University of Central Florida’s Sean Snaith.
In his Halloween-themed Florida forecast (ahem, “gore-cast”) released this morning, Snaith channels the famous poet Edgar Allan Poe to describe the recession’s lasting effects. “It was the sound of worsening labor markets,” he writes, which grow “louder — louder — louder!”
Snaith, the director of UCF’s Institute for Economic Competitiveness, says the state’s unemployment rate will peak at more than 11 percent next year as other sectors of Florida’s economy also struggle for longer than their counterparts in the rest of the country.
Employment levels won’t return to pre-recession conditions until 2014, he says.
“The job market will haunt us for years after the recession has ended,” Snaith said. “As we saw during the boom, strong growth can quickly and dramatically ratchet down the unemployment rate, but a weak recovery just prolongs our pain.”
Snaith’s Florida forecast also coincides with today’s report from the U.S. Commerce Department, which shows that gross domestic product expanded 3.5 percent in the third quarter — a boost that’s temporary and misleading, Snaith says.
“I still believe that this recovery will be shaped like a gravy boat with growth gradually recovering, like the dish’s tapered spout,” he said. “Today’s GDP figures are just lumps in the gravy that will give way to weaker growth in the quarters to come.”
Snaith’s forecast offers predictions through 2013 for Florida and its 12 metropolitan regions. Those areas are Naples, Daytona Beach-Deltona, Gainesville, Ocala, Lakeland, Palm Bay-Melbourne, Pensacola, Miami, Jacksonville, Tallahassee, Tampa Bay and Orlando.
Other highlights include:
- Florida’s population is expected to decline again in 2009 and stay flat in 2010 before population growth slowly climbs to 1.5 percent in 2013.
- The housing construction’s sector finally bottoms out deeper than many expected in 2009, falling to roughly 25,000 housing starts at an annual rate. In 2013, housing starts will recover to 2001 levels, rising gradually to 170,000 starts a year.
- Sales of existing homes have shown strength in recent months as the 12-month moving average of sales has been on the rise since August 2008. Prices, however, are still struggling to find a bottom, and until this occurs, we will still have instability in the housing sector.
- From 2010 to 2013, retail sales will steadily accelerate after a weak first quarter in 2010 and grow at an average pace of 5.1 percent as consumer spending returns, fueled by pent-up demand.
Snaith is a national expert in economics, forecasting, market sizing and economic analysis who authors quarterly reports about the state of the economy. Bloomberg News recently named Snaith as one of the country’s most accurate forecasters for his predictions about the Federal Reserve’s benchmark interest rate, the Federal Funds rate.
Snaith is also a member of several national forecasting panels, including the Western Blue Chip Economic Forecast panel, the National Association of Business Economics Quarterly Outlook Survey Panel, the Federal Reserve Bank of Philadelphia’s Survey of Professional Forecasters, Bloomberg U.S. Economic Indicator Survey and USA Today Economic Survey Panel.
The UCF Institute for Economic Competitiveness’ mission is to expand public understanding of the economy by convening business leaders, scholars, policy makers, civic groups and media to discuss critical issues.