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These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

Despite the recent $150 billion tax increase, uncertainties imposed by sequestration and halting growth in consuming spending, economists expect GDP growth to rebound and moderate jobs creation to continue.

Friday, forecasters expect the Labor Department to report the economy added 171,000 jobs in February, and for unemployment to remain unacceptably high for several more years.

In the fourth quarter, GDP was up at a scant 0.1 percent annual pace, slowed by a drop in inventory build and smaller Pentagon purchases. However, those factors are not likely to repeat in the first-quarter data, and the effects of sequestration will not likely be felt until spring.

Consumers have been constrained by higher gas prices and the January tax increases, but overall, economists expect GDP growth to be in the range of 2 percent or a bit higher in the first quarter.

Still, the pace of recovery remains disappointing, in part, because Dodd-Frank regulations make mortgages, refinancing and home-improvement loans much more difficult to obtain. Those hold down existing homes sales, renovations and demand for building materials, major appliances and other durable goods. Continue reading…

These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

The U.S. economy added 146,000 jobs in November, up a bit from 138,000 in October. Unemployment fell to 7.7%, largely because 542,000 additional adults chose not to look for work.

Hurricane Sandy and business fears regarding the so-called fiscal cliff contributed to the slow pace of jobs creation; however, the overall picture is worse than these headline figures reveal and will remain difficult until the policy fundamentals change.

In the weakest recovery since the Great Depression, most of the reduction in unemployment from its 10.0% peak in October 2009 has been accomplished through a significant drop in the percentage of adults working or looking for work. Were adult labor-force participation the same today, the unemployment rate would be 9.7%.

Adding more than eight million part-time workers who can’t find full-time work, the unemployment rate becomes 14.4%. That measure rose above 14% in the wake of the financial crisis and remains stuck there.

Convincing millions of Americans they don’t want a job or compelling desperate workers to settle for part time work has been the Obama administration’s most effective jobs program.

Economic growth remains weak, as most of the pickup to 2.7% in the third quarter was attributable to inventory build and a temporary surge in exports. Consumer spending and business investment weakened, substantially, and goods piled up warehouses–either in the fourth quarter or early next year, inventories will be adjusted and growth will slow. Exports will slow as Europe’s recession continues. Continue reading…

These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

Thursday, the Commerce Department is expected to report the deficit on international trade in goods and services was $44 billion in August, up from $42 billion in July.

Imported oil and subsidized imports from China account for nearly the entire $525 billion annual trade gap and pose the most significant barriers to robust growth and jobs creation.

The economic recovery began five months after Barack Obama took office, and gross domestic product growth has averaged 2.2%. In October 2009, unemployment peaked at 10%, but has fallen to 7.8%, however, about 90% of that reduction has been caused by a falling percent of adult Americans seeking work.

Ronald Reagan inherited a similarly troubled economy with unemployment cresting at 10.8% early in his presidency. When he sought re-election, the economy was growing at 6.3%, unemployment was 7.3% and a rising percentage of Americans were seeking work. Continue reading…

These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

On Friday, forecasters expect the Labor Department to report the economy added 113,000 jobs in September, a monthly pace too slow to return the nation to full employment.

The economy must add more than 375,000 jobs each month for three years to lower unemployment to 6% and that is not likely with current policies.

Most analysts see the unemployment rate steady at 8.1%, while a few see an increase. The wild card is the number of adults actually working or seeking jobs, the measure of the labor force used to calculate the unemployment rate.

Were the labor force participation rate the same today as when unemployment peaked above 10% in October 2009, the unemployment rate would still be about 10%. Were it the same as when President Barack Obama took office, it would be about 11%. Continue reading…

These are the personal views of Thomas Lam, group chief economist at OSK-DMG:

The U.S. data releases last week evolved somewhat unevenly through Thursday, but ended on a weak note with the August employment report on Friday.

Aside from the weaker-than-expected August headline figure on nonfarm payrolls of 96,000 and net downward revisions of 41,000 in the prior two months, the forward-looking indicators of employment also imply less upside in the coming months.

The two broad labor market gauges that seem to be holding steady for August are the one-month diffusion index for private nonmanufacturing payrolls, which is hovering at roughly 56% (according to our calculations), and the private workweek. Separately, the decline in the August unemployment rate to 8.1% was driven mainly by the slide in labor force participation to 63.5%, the lowest since 1981. Without the decline in the participation rate, all else equal, the unemployment rate would have risen slightly to 8.4% in August from 8.3% in the prior month. Continue reading…

These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

The economy added 96,000 jobs in August, down from 141,000 in July and not nearly enough to keep pace with population growth.

The unemployment rate fell to 8.1% only because 581,000 workers quit looking for work and are longer counted in the official jobless tally.

In the weakest recovery since the Great Depression, the entire reduction in unemployment from its 10.0% peak in October 2009 has been accomplished through a significant drop in the percentage of adults participating in the labor force–either working or looking for work.

The most effective jobs program appears to be to convince working-aged adults they don’t need a job.

Growth slowed to 1.7% in the second quarter, as consumers pulled back and the trade deficit on oil and with China continued to drag on demand. The outlook for the second half of the year is not much better. Car sales are stronger than a year ago, but are not likely to improve much further, and housing prices have risen in recent months but on weak volumes. Continue reading…

These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

The economy added 163,000 jobs in July. Although an improvement over the first quarter, the ranks of the unemployed swelled another 45,000.

The unemployment rate rose to 8.3%, even as 348,000 workers quit looking for work and were no longer counted in the official jobless tally.

In the weakest recovery since the Great Depression, nearly the entire reduction in unemployment since October 2009 has been accomplished through a significant drop in the percentage of adults participating in the labor force–either working or looking for work.

Economic growth slowed to 1.5% in the second quarter, as consumers pulled back and the trade deficit on oil and with China continued to drag on demand. The outlook for the second half of the year is not much better. Car sales are stronger than a year ago, but are not likely to improve much further, and housing prices have risen in recent months but on weak volumes. Continue reading…

 These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

No issue is more misunderstood, or has been more purposefully confused by the Romney and Obama campaigns, than outsourcing.

Outsourcing is merely the importing side of international trade: purchasing abroad goods and services, along with components to assemble final products in the U.S.

Just about everyone who has had a choice between buying a U.S.-made product or an import–a car, a wedge of cheese or a movie online–must admit that two-way trade based on legitimate comparative advantages is a good thing.

If Americans expect folks abroad to purchase Boeing Co. (BA) aircraft and Intel Corp. (INTC) processors, then they had better be prepared to outsource some of what they purchase directly, or through the firms that assemble products domestically and their government.

The problem is not outsourcing but rather it is inappropriate outsourcing: purchasing abroad products that could be made as or more cost-effectively at home. That happens when U.S. policy throws up unnecessary barriers to domestic production; foreign governments unfairly subsidize businesses or simply keep out competitive U.S. products; or U.S. firms have an inappropriate bias toward foreign sourcing. Continue reading…

These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

Friday, forecasters expect the U.S. Labor Department to report the economy added only 90,000 jobs in June, not even enough to keep up with growth in the working-age population.

Most analysts see the unemployment rate remaining staying at 8.2%, while some anticipate an increase. The wild card is the number of adults actually working or seeking jobs–the measure of the labor force used to calculate the unemployment rate. Adults who have quit looking and left the labor force altogether are responsible for 99% of the reduction in the unemployment rate from 10% since October 2009.

Many adults have reason to be discouraged–new jobs pay lower wages than did those lost during the recession. Policies favoring bank consolidation and financial schemes, alternative energy and high technology, and government expansion of health care, are hampering jobs creation in core-manufacturing, resources and many service activities. Those policies encourage more off-shoring, push down wages, pad big bonuses and dividends and skew income toward the wealthiest in Manhattan, the Silicon Valley and other bastions of privilege. Continue reading…

These are the personal views of Peter Morici, a professor at the University of Maryland’s Robert H. Smith School of Business and former chief economist at the U.S. International Trade Commission:

For the second month in a row, retail sales pulled back in May.

The private sector continues to struggle from weak demand, the economy is clearly slowing, and the pace of job creation will likely stay lethargic through the summer.

In May, lower gasoline prices did pull down retail spending but sales of consumer basics, such as groceries, health and personal care products, and general merchandise sold in department and variety stores, were down. Restaurants and bars saw a drop too. Overall, retail sales were down by 0.2% in both April and May.

Regarding the broader economy, flagging retail sales in April and May should be evaluated alongside stagnant wages for the last three months, falling productivity and factory orders, and declining prices reported by many manufacturers and service establishments.

Businesses are slashing prices to maintain volume, cutting back on new orders and likely have more workers than they need. Consumers are trimming revolving credit and becoming more cautious. Overall, if spending does not turn upward in June and July, the economy is headed for a period of contraction: negative growth and a mild recession.

Particularly alarming, these data do not bear the full weight of the slowdown in Europe, which will grip the U.S. economy more significantly in the summer months.

At the very best, economic growth will remain subpar and new job creation anemic, and the private sector continues to struggle. Layoffs will increase and unemployment will rise unless more adults quit the labor force.