Experts See Economy Turning Corner In 2011 Overall, economists are optimistic about the new year. Many forecasters put U.S. economic growth at around 3 percent, but say there will still be areas of weakness. The housing market is expected to continue bumping along the bottom, and the job market won't be much better.
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Experts See Economy Turning Corner In 2011

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Experts See Economy Turning Corner In 2011

Experts See Economy Turning Corner In 2011

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LIANE HANSEN, host:

This is WEEKEND EDITION from NPR News. I'm Liane Hansen.

As the year winds down, it may come as a surprise that the economy actually grew in 2010, but that growth was so slow many people didn't feel any improvement - particularly the 15 million Americans who remain jobless.

As for 2011, NPR's Tamara Keith reports that the economy should be looking up next year, but don't expect much relief for the unemployed.

TAMARA KEITH: If the forecasters are right, one phrase we should hear a whole lot less of in 2011 is "double-dip recession."

Mr. DAVID SHULMAN (Senior Economist, UCLA Anderson Forecast): Never say never, but the risk of a double dip seems to be off the table right now.

KEITH: David Shulman is a senior economist at the UCLA Anderson Forecast.

Mr. SHULMAN: We're feeling better now than we were, say, a month ago.

KEITH: Recently, the regular trickle of economic data has been coming in better than expected. The stock market is on a bit of a roll and there's the president's tax compromise.

Mr. SHULMAN: The first thing, the tax compromise took off a bunch of uncertainty. The other thing is, is the two percent reduction in the payroll tax. That's worth $111 billion. That's real stimulus.

KEITH: In St. Louis, Missouri, Steve Schulte, CEO of Porta-King Building Systems, says he's looking forward to 2011 in a way he wasn't looking forward to this year. Customers are asking for estimates again for the modular buildings he manufactures.

Mr. STEVE SCHULTE (CEO, Porta-King Building Systems): We are getting requests for quotations, which is a major indicator that things are starting to change. I think we're going to see that turn actually happen in 2011.

KEITH: Do you anticipate hiring in 2011?

Mr. SCHULTE: We fully hope to.

KEITH: If he can convert those inquiries into hard orders.

Jay Bryson is an economist at Wells Fargo Securities. He says 2011 will be the year the U.S. economy turns a corner.

Mr. JAY BRYSON (Economist, Wells Fargo Securities): I think people will measure 2011 as a better year than 2010. We're just not completely back to, quote, "normal" yet.

KEITH: Many forecasters put economic growth at around three percent next year. But there will still be areas of weakness. The housing market is expected to continue bumping along the bottom, and the job market won't be much better, says Bill Rodgers. He's an economist at the Heldrich Center for Workforce Development at Rutgers University.

Mr. BILL RODGERS (Economist, Heldrich Center for Workforce Development, Rutgers University): We will make progress but we're not going to be back at that level where friends and family or colleagues next to you are going to be feeling overjoyed and wonderful about the economy, about job prospects and about their future.

KEITH: In Warren, Michigan, Karen Alexander doesn't see a shift in the economy.

Ms. KAREN ALEXANDER: There's really no big rays of sunshine coming my way yet.

KEITH: Alexander used to work in the auto industry, used to make a good living. That was two years ago. Her unemployment benefits recently expired and her financial situation is dire. She's set to start a part-time nursing job after the first of the year but she knows already it's not the answer to her problems.

Ms. ALEXANDER: I have hope, I have faith, but it hasn't done me justice in the last two years.

KEITH: And she's unfortunately in good company. The unemployment rate is currently 9.8 percent. Another nine million people have part-time jobs but want full-time work.

Economists Jay Bryson, Bill Rodgers and David Shulman all agree the employment situation will improve next year, but not much.

Mr. BRYSON: December 2011, what I think the unemployment rate will be. I'm going to pick 9.0.

Mr. RODGERS: Probably somewhere, you know, 8 and a half to 9 percent.

Mr. SHULMAN: Between 9 and 9 and a half percent.

KEITH: Or in other words, better but nowhere near good.

Tamara Keith, NPR News, Washington.

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