CBO projects unemployment above 8 percent until 2014

Congressional Budget Office (CBO) Director Douglas Elmendorf

/ AP Photo/Charles Dharapak, file

Economic growth in the United States is expected to remain weak for several years and unemployment will likely stay above 8 percent for another three years, the head of the non-partisan Congressional Budget Office said Wednesday.

In a blog post accompanying the agency's latest estimates of the U.S. budget situation, CBO Director Douglas Elmendorf said the economy could be in for a prolonged downturn, exacerbated by recent turmoil in financial markets.

"Although total output began to expand again two years ago, the pace of the recovery has been slow, and the economy remains in a severe slump," Elmendorf wrote.

The CBO expects the U.S. economy to grow somewhere between 2.4 and 2.6 percent annually this year and next, followed by just 1.7 percent growth in 2013. And that slow growth will take its toll on employment.

The Labor Department earlier this month said the July unemployment rate was 9.1 percent. The CBO expects that to drop to 8.9 percent in the fourth quarter of this year and to 8.5 percent in the fourth quarter of next year, when voters decide on whether President Obama deserves a second term in office. One third of the Senate and all 435 House members also face voters.

The CBO forecasts the unemployment rate to average around 8.7 percent in 2013 and then fall to an average of 7.9 percent for 2014.

The agency, which is the official scorekeeper for Congress, said it expects the recently passed budget deal and lower interest rates to cut projected budget deficits in half over the next decade.

The United States is expected to post $3.487 trillion in cumulative deficits over 10 years, about $3.3 trillion lower than its previous estimate.

The federal deficit is projected to hit $1.28 trillion this year, slightly smaller than the last two years, but still the third largest deficit in 65 years.

[Smokey75]

It's funny Obama and liberals have spent the last two years demonizing corporations and businesses and now they want to cry because corporations and businesses won't hire.

Businesses are sitting on two trillion in profits because they don't know what the most anti-business administration in history is going to next. You can't be anti corporation and then say your pro jobs since corporations are where jobs are.

[nearl451]

by Shinethelight August 24, 2011 3:13 PM EDT
The solution was figured out by a neighbor's of mine 10 year old child.
_________________________________________________________-

I can excuse a 10 year old for confusing unemployment with indebtedness. I can not excuse you for making that same mistake.
By in large, 10 year olds repeat what they hear - especially when confronted with concepts they have a hard time understanding.

I have yet to have any of you, let alone a 10 year old, correctly explain to me how international trade deficits over the long term lend to chronic indebtedness. I can always hope.

[RobAla]

This is bad news. However, I question President Obama's wisdom on another related subject:

Fox News - Bill O'Reilly reported on General Electric and China developing aircraft technology that will compete with American companies (like Boeing). President Obama appointed GE's CEO Jeffrey R. Immelt as Chair of Presidents Council on Jobs and Competiveness.
http://video.foxnews.com/v/1125886140001/why-is-ge-launching-joint-venture-with-china
I want to know three things:
1) Where is the outrage from union bosses over this?
2) Where is the CBS coverage on this?
3) How could any President appoint a CEO of a company that is joining with China to compete against American companies as the Chair of Presidents Council on Jobs and Competitiveness?

[nearl451]

If you are going to use slave labor and/or a communist labor engine to 'drive' your "free-market" philosophy, I think you have already lost the moral high ground.

Our system of govt is divided for reasons; China's purpose is singular (or at least coordinated) exuding efficiency that even parlimentary systems cannot match.

Besides, what good would the outrage be. We are addicted to slave labor and Walmart.

[RobAla]

neari451: I'm sorry, but you sound a bit conflicted:
Are you saying that you dislike both the "free market system" and the communists slave labor system? IF so, what DO you like?

Do you like our system of three branches of government, or do you like (what you say is the more efficient) the communist system? I happen to like our democratic republic of three branches.

Are you saying that we should not be outraged at what this President is doing? Are you saying that we should just be addicted to slave labor? What do you have against Walmart? Walmart provides far better health care insurance than what I had as a construction worker years ago - which was NOTHING! It hires the elderly. My mother was a door greater at Walmart, and she was thankful that they would give a job to an elderly widow.

I am really having trouble determining what you actually think, unless you are one those that makes any excuse possible to continue support for President Obama. However, thanks for the response.

[newnameagain]

bonzo said lets spend 800 billion dollars and unempolyment won't go above %8 he pulled the wool over your eyes on that one

[realist51]

Ahh yes! and the republicant's/Bush said 3.9 TRILLION dollars in tax cuts would increase revenues and create jobs. ten years the worst job growth of any president plus 5 trillion in deficit spending. and America is still waiting.

[wfw3536]

For some folks who do not go beyond this site you should look at the Gallup site which each day shows unemployment numbers and underemployment numbers. Today it shows unemployment at 9.1% and underemployment at 18.1%.

[david4673]

9.1% is a verifiable number. 18.1% is an educated guess since no actual stats exist to quantify this segment.

Did you not know that underemployment has been calculated by BLS for years and years. If you would say UI was 7.8% when Bush left office and Obama was sworn in (which it was), you would then have to also report that underemployment was at 15% (approx) at that time.

Were you intentionally misleading with your post -- as a GOP apologist -- or are you just unaware of these facts?

[tsigili]

If the fools in Congress don't act soon, it will be longer than that.

[david4673]

Congress is an equal partner as per the US Constitution establishing separation of powers, AmMe1.... I guess you didn't know that. Your ignorance is matched by your bias and neither allows you a clear and fact based opinion.

1perish... without demand, business does not need employees to produce goods or provide services. I guess you think all business owners are thin skinned scaredy cats. Wrong. Some are decent people that would hire if they needed to because of increased sales. President Obama knows this. He, unlike you, is a smart man with common sense.

[RealWorldNow]

The most damaging part of the article is the last line. Goos job burying it CBS!

"The federal deficit is projected to hit $1.28 trillion this year, slightly smaller than the last two years, but still the third largest deficit in 65 years."

This will be Obama's legacy, the most debt ridden president in history!

It's good to know he is focusing on Jobs like a laser since 2008 !

[david4673]

So, I guess yiu are for ending the Bush tax cuts... a major driving force in the projected deficit?

Creating jobs and the structural deficit are not even in the same ballpark. Maybe you should write your GOP Reps and tell them to start creating the jobs they promised when they ran for their current seats, huh? They could just support some of the measures THEY proposed and now walk away from because Obama agrees... how about that?

[RealWorldNow]

Yes I am for ending tax cuts but not for just a small segment of society but only and I mean only when the spending gets cut first ! I hated the medicare hand out for prescription drugs that wasn't paid for. The problem is, no one has proven themselves responsible in cutting spending to get back to a fiscally safe position (less than we take in). The problem has always been that when taxes are increased the credit card comes back out like and addict.

Jobs, now, realistically, do you think one house of congress can put in place any program when the other and the presidency are from the opposite party? Didn't think so...

Ok David.... name me one policy our president has put in place that has created new non-public sector jobs in his 2-1/2 years?

[wfw3536]

Why don't they say that right now we have over 18% of the population who either un or underemployed. The unemployment number the government keeps does not include folks who no longer qualify for benefits and that tanslates into millions more. It is sad when the administration has gone for almost 3 years without a specific jobs plan. Now Obama is making a big deal that he will present his specific jobs plan in Sept when he finishes his vacation with the rich.

[david4673]

The two unemployment numbers are not new.

The one that is at 9.1% (there isn't one currently at 18%. you made that up... or got it from a false source) is the only one that is verifiable because it reflects actual UI claims... the under employed/stopped looking number is just an educated guess -- hence, it is not used to gauge the job situation.


Where is the Congressional jobs plan? The House is full of people that promised one... and are they at work right now? Oh really, they have five weeks off... wow.

[Progress4U]

"Economic growth in the United States is expected to remain weak for several years and unemployment will likely stay above 8 percent for another three years, the head of the non-partisan Congressional Budget Office said Wednesday."

Key word here AmericanMe1 is "above"...that includes 9.0 - 9.1 - 9.2, that range. May go down to 8.9 - 8.8...still "above" 8.0, right!?!!?