Competing economic outlooks

It’s been said that if you ask 10 economists a question, you’ll get 10 answers. As economists look into their crystal balls for 2014, what are their alternative views on the economy? N.C. State University economist Mike Walden answers.

“There really are probably 10 opinions for every 10 economists, but there really are two main views right now. I’ll call them an upbeat view and a not-as-upbeat view.

“The upbeat view says that we’re actually going to see a much, much better economy in 2014. These economists see growth accelerating primarily due to continued low interest rates and improved housing markets, repaired household finances and pent-up demand by consumers who put off, over many years, the buying of things like appliances and furniture, et cetera.

“Now these economists see, perhaps, the unemployment rate dropping somewhere between a half percentage point and a full percentage point, and that would be both nationally as well as here in North Carolina.

“But there is a second view that’s not as upbeat that does see the economy growing. So it’s not that this group sees a recession, but they think that we’re going to continue to see the slower growth, primarily, that we’ve had over the last two years. And they base this on the fact that we’ve had a large number of workers who left the labor force because they don’t have the right skills. We have an aging population — increased retirees. We have a lot of new regulations that have been imposed on businesses by some legislation at the federal level. So this group sees all of those factors contributing to sluggish growth in 2014.

“So all I can say to listeners is, ‘Place your bets on which view you might think will come true.'”

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