A state-by state look at the economic forecasts for New England states issued Tuesday by the New England Economic Partnership:
--CONNECTICUT: The state has lost nearly 80,000 jobs since the first quarter of 2008 and remains in a "severe and prolonged" recession, with job losses likely to total nearly 100,000 by the second quarter of 2010. Connecticut was slow coming into the recession, but will also likely be late in emerging from the downturn, with only a modest recovery anticipated between 2011-2013. Even by the end of 2013, unemployment could remain at a relatively high 5.8 percent. Continuing declines in income, sales and property tax collections will strain state and municipal budgets and possibly lead to deep service cuts in the next two years. Because of its relative proximity to Wall Street, the recovery in Connecticut will also be impacted by the restructuring of the nation's financial services industry.
--MAINE: The percentage of jobs lost in the state during the current recession has been less steep than the nation as a whole. Still, 27,850 jobs have disappeared since early 2008 with every sector of the economy suffering losses. Moreover, wages and salaries have fallen at a sharper rate than employment, indicating that many businesses have cut hours, slashed overtime, imposed furloughs or taken other measures. Job growth is not expected to resume in Maine until the fourth quarter of 2010 and it will likely take another 2 1/2 years to return to pre-recession levels.
--MASSACHUSETTS: The state's economy is likely to bottom out in the current quarter but job losses should continue through the third quarter of next year, with unemployment peaking at 9.6 percent. (The rate stood at 9.3 percent in September.) The third quarter of 2009 was disappointing for Massachusetts, as the state's real GDP growth slid at an annualized rate of 1.1 percent, at the same time the nation's GDP was expanding at a 3.5 percent rate. On a more positive note, employment is likely to rebound more quickly during the recovery than it did in previous recessions, driven by growth in the medical, information and education services sectors. Housing prices in Massachusetts are projected to begin growing, though slowly, by the end of 2010.
--NEW HAMPSHIRE: The state can be seen in some ways as a bright spot in New England, with the recession technically over and job losses having never reached the levels of other states in the region or the nation as a whole. During the forecast period of 2008-2013, New Hampshire is expected to see total employment growth of 1.2 percent, with the biggest gains in educational and health services. The state may not remain the beacon it was for people seeking a lower cost-of-living and housing prices. While home sales and prices have fallen since the start of the recession in New Hampshire, they have fallen at even sharper rates elsewhere. Also, many homeowners owe more on their mortgages than their homes are valued, reducing available sellers.
--RHODE ISLAND: There is no way around it: economic indicators show Rhode Island remains in serious economic trouble. Unemployment stood at 13 percent in September, more than three percentage points higher than the national average. Of the 74,000 unemployed residents in the state at the end of the month, 17,760 had been out of work a year or longer. The state's real GDP of $37.6 billion is $200 million less than it was five years ago, though slight growth is expected in 2010 and 2001. Median home prices in Rhode Island have fallen to their lowest point since 2002. Adding to the state's woes is a deepening state budget deficit, which could exceed $200 million in the current fiscal year. If the deficit isn't reigned in, forecasters say the state's economy will have trouble growing over the next few years.
--VERMONT: The recession in the Green Mountain state will bottom out in the fourth quarter of 2009 but linger into 2010, with normal growth rates not anticipated until 2011 at the earliest. Vermont's overall unemployment rate has been declining since it peaked at 7.4 percent in May. But the state has also experienced a greater percentage decline in payroll jobs than the region as a whole, with those declines expected to continue through the second quarter of next year. Year-to-date housing prices have declined 9.8 percent from 2008 levels, but there is evidence that the declines are abating and by some measures home prices may even be starting to increase in parts of Vermont.
Source: New England Economic Partnership http://www.neepecon.org
