State Economy: Don’t Hold Your Breath

The latest edition of the state economic forecast produced by University of Tennessee’s Center for Business and Economic Research has what you’d have to call very tepid good news: Things are not getting worse, and there are some hopeful signs. But we’re a long way from a healthy economy. The report, written by CBER Associate Director Matt Murray, notes that national GDP is projected to grow just 2.7 percent this year, and 2.2 percent in 2011—hardly enough to make up the ground lost in the waves of unemployment that have struck since 2008. He writes, “Expect an anemic expansion and several years of lackluster growth before economic conditions fully stabilize.”

In Tennessee, the report projects, “Personal income should advance 3.8 percent in 2010, followed by 4.0 percent growth in 2011.” And the second quarter of 2010 showed the state’s first year-over-year gain in taxable sales since 2008. But even by the end of next year, it says the state will probably see an unemployment rate of about 9.5 percent—despite the 9.4 percent state jobless rate in September, down from 9.6 percent in August.

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