by Karen Brune Mathis
Managing Editor
It was a long, deep and encompassing recession.
And it’s probably over.
University of Central Florida economist Sean Snaith plans to tell the First Coast Real Estate Economic Outlook conference next week in Jacksonville that the “great recession” probably ended in the third quarter of 2009.
While the National Bureau of Economic Research makes the official call about when a recession begins and ends, Snaith said most economists believe it ended in the third quarter.
Snaith said the economy started to expand in the third quarter and again rose in the fourth quarter. There’s not a lot of celebrating yet.
“You would think there would be some jubilation, but the problem is the scar that’s left on the economy, which is the labor market,” Snaith said.
“The ugly scar is there to remind us of what we’ve been through, with double-digit unemployment and even higher underemployment. It’s hard to get excited,” he said.
The U.S. unemployment rate has fallen to just below 10 percent. Snaith said that after adding the number of people who are underemployed, the rate rises to about 18 percent. Underemployment is working part-time but not by choice, he said.
“This recession was an equal opportunity recession,” he said. “We saw construction laborers and lawyers lose jobs, plumbers and professionals. it really did cross the socioeconomic strata,” Snaith said.
“In that sense, it didn’t leave any sector of the economy untouched,” he said.
Florida lost more than 750,000 jobs in the almost two-year recession, he said. They won’t reappear anytime soon. “We are talking several hundred thousand jobs and a lot of these jobs may never come back.”
Economists generally agree the recession began in December 2007 and Snaith believes it ended around September 2009.
“This is a doozy,” he said.
The last two recessions in 2001 and in 1990-91 lasted just eight months each. Snaith’s analysis shows that the only comparable recessions in length in the past 40 years were two 16-month recessions in 1973-75 and 1981-82.
For Florida, Snaith expects double-digit unemployment until 2012. “Firms are not rushing out to hire,” he said. “They have people on the payrolls and can increase those hours before they have to go out and hire new folks.”
In January, Florida’s unemployment rate was 11.9 percent and Jacksonville’s rate was 10.4 percent.
Snaith said Jacksonville would be helped out of the recession by its relatively lower costs.
“It is still going to be a struggle for Jacksonville and all of Florida,” he said.
He predicted job growth in healthcare, manufacturing and professional business services.
Healthcare growth will be driven by the needs of an aging population and the move toward expanded coverage. Manufacturing will staff up “after several years of getting as lean and mean as that sector possibly can get,” he said. Professional services and white-collar jobs will pick up as economic activity increases.
“For 2010, the best thing we can say is it’s not 2009. The recession is over, but we still have a tough road to hoe,” said Snaith.
Real Estate Outlook Conference event chair Dan Corritore expects 350 people to attend. “From Sean, you always expect to hear the truth. He is not going to sugarcoat anything.”
Corritore is an agent with Coldwell Banker Commercial Benchmark.
Snaith, director of the Institute for Economic Competitiveness at the UCF College of Business Administration, will present his update to the conference at 8:30 a.m. Tuesday at the Osborn Center. For more information, check www.reoutlook.com
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