US recession over, but employment will lag: survey

The recession gripping the United States for nearly two years is over, but economic growth may be held in check by high unemployment, a poll of business economists showed today.

"The Great Recession is over," according to the consensus macroeconomic outlook of a panel of 44 professional forecasters of the National Association of Business Economics (NABE).

"The survey found that the vast majority of business economists believe that the recession has ended but that the economic recovery is likely to be more moderate than those typically experienced following steep declines," NABE president-elect Lynn Reaser said.

More than 80 per cent of economists surveyed believed that an expansion has begun, according to poll conducted during the September 2-24 period.

The study also found that the more-than-three-year downturn in the US housing market, epicentre of financial turmoil that slammed the brakes on growth, was very close to ending, with an upturn expected next year, said Reaser, chief economist at Point Loma Nazarene University.

According to the survey, the key areas of concern were the increasing federal debt and unemployment rates, "expected to remain very high through next year".

The unemployment rate was forecast to rise to 10 per cent in the first quarter of next year and edge down to 9.5 per cent by the end of 2010 while inflation is expected to remain contained throughout next year.