By Angela Carter
RISMEDIA, January 15, 2009- (MCT)-The housing market, where the national economic troubles began, is expected to hit bottom in autumn, and the current streak of job losses is likely to peak at 9 million by next year, according to projections released Monday.
“This will be the worst downturn since the Great Depression,” said Augustine Faucher, director of macroeconomics for Moody’s Economy.com, which provides economic analysis, data, and forecasting and credit risk services.
Faucher spoke Monday during the 2009 Economic Summit & Outlook, held at the Hartford Marriott and sponsored by the Connecticut Business & Industry Association, the Metro Hartford Alliance and Webster Bank.
Connecticut’s economy is dependent on the financial sector, aerospace and defense, and technology production, Faucher said. The state is in recession along with the nation, driven mostly by declines in industrial production, job losses on a year-over-year basis and a “rapid weakening” in the labor market, which jumped from a 4.5% unemployment rate in early 2007 to 6.5% in November, the most recent month for which data is available.
Although recent weakness in the U.S. dollar has helped state exporters, the global economy is starting to slow down and is heading toward recession, Faucher said. “We can’t count on the global economy to bail us out,” he said.
But the recession will eventually end and when it does, Connecticut will lag behind the nation when the recovery starts, Faucher said, because of its aging population and weaker labor force growth rates.
Faucher said that if the federal government implements appropriate recovery policies a turnaround could begin late this year.
U.S. Sen. Joseph I. Lieberman, I-Conn., said the stimulus package being debated in the U.S. Congress would not be any less than $800 billion, but the numbers are moving daily.
“The size is by any conventional standard massive, but so is the problem,” he said.
The package will include funds to states for Medicaid, infrastructure and transit improvements, tax cuts for individuals and families, alternative energy and tax cuts and credits for businesses. Lieberman estimated that about $200 million could come to Connecticut.
Copyright © 2009, New Haven Register, Conn.
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