Business Economists Predict Job Growth

A recent survey released by the National Association of Business Economists, a professional organization representing economists associated with business world, shows increased optimism for the country’s economic future as demand for services has moved higher over the last few months. According to the survey, taken among 68 economists reporting on business conditions in their firm or industry, jobs have grown, and are expected to continue to grow, this year, with payrolls increasing from 13 percent in January to 22 percent now. The number of firms cutting jobs, meanwhile, has decreased from 28 percent to 13. More than a third of economists polled, 37 percent, expect firms to add employees over the next six months, up from 29 percent in January’s survey.

This could be due to an overall increase in industry profits reported by survey respondents, driven by an increased demand for services over three consecutive quarters. This has led to an increasingly sanguine outlook for the economy, with 70 percent of survey respondents believing that the economy will expand by more than 2 percent in 2010.

Also driving industry profits, according to the survey, are increased prices for goods and services. Though the business world (and the economists it employs) may see this as a good thing, it could be a point of concern for the middle class, which has been facing years of stagnant wages despite, or perhaps because of, greatly increased productivity.

Still, the survey’s results line up with other reports of a building economic recovery, such as that released by the New York Federal Reserve earlier this month. However, as the number of jobs increases, unemployment statistics could still show a downturn due to the fact that the jobless rate counts only those actively looking for work; as the economy improves and people begin seeking jobs again, the number of people listed as jobless could nonetheless increase.

Interestingly, the NABE survey’s summary quotes William Strauss of the Federal Reserve Bank of Chicago as saying that little of the job growth reported by the economists can be attributed to the stimulus package put out last year. Some 73 percent of economists polled said that the stimulus has had no impact on their employment to date while 68 percent think that a jobs bill will similarly have no impact on payrolls.