The following story by The Associated Press appeared in numerous media, including the October 28, 2010, edition of The New York Times. Professor Albert Niemi, dean of SMU's Cox School of Business, provided expertise for this story.
October 28, 2010
WASHINGTON (AP) — The new Congress that begins in January will confront an economy and a job market that will improve only slightly next year, according to an Associated Press survey of leading economists that found them gloomier than they were three months ago.
Unemployment will dip only a bit from the current 9.6 percent to a still-high 9 percent at the end of 2011, in their view. In fact, some economists now think unemployment won't drop to a historically normal 5.5 percent to 6 percent until at least 2018 — several years later than previously envisioned.
The latest quarterly AP survey shows economists are pushing back their estimates of when key barometers of health — hiring, spending, economic growth — will signal strength. . .
Even Americans who do have jobs still aren't confident enough to spend freely. Many are still pained by their loss of wealth since the financial crisis struck in 2008. Home equity has fallen sharply from its pre-recession peak. So has the value of stock holdings and retirement savings.
"American households lost $14 trillion of their net worth in the recent recession," said survey participant Albert Niemi, dean of the Cox School of Business at Southern Methodist University. "The loss in wealth, plus tight credit, will depress consumer spending for the next several years."
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