U.S. Unemployment Rate Shows No Sign of Dropping

If you are one of the 15million Americans who are currently unemployed, expect some company within the next year. Experts believe that the unemployment rate in the United States could rise from 9.8% to more than 10% by the middle of 2010.

This prediction was made by Christina Romer, the chairwoman of the White House Council of Economic Advisors, during a hearing of the Joint Economic Committee of Congress. In addition to her prediction that unemployment rates would rise above 10%, Romer added that she believes job growth will not start to rise again until 2010 reaches a close.

Romer repeatedly cited a study conducted and published by a private sector of forecasters who think the economy will begin to emerge from the recession over the course of the next year, and will grow very slowly during this time period.

Romer also warned that unemployment growth tends to recover from economic downturn at a much slower rate than economic growth. This means that job creation must recover a lot of ground lost over the past two years, and will most likely do it slowly.

The U.S. unemployment rate is currently listed at 9.8%, and is expected to briefly lower and settle at 9.6% by the end of 2009. This rate change will not be long, however, and unemployment rates are expected to peak at 10.1% during 2010’s second quarter.

Approximately 7.2 million jobs have been lost since the United States slipped into a recession two years ago. Experts estimate that 10,000 jobs have to be created per month just to keep up with increases in population. By these calculations, the United States currently has 9 million fewer jobs than needed.

It can, however, be noted that the United States economy has grown considerably over the past six months. This progress can largely be contributed to President Barack Obama’s American Recovery and Reinvestment Act, which has pumped $787 billion dollars into the economy.

Romer’s address to the Joint Economic Committee of Congress ended with a warning that employers in the United States will most likely be very cautious as the economy turns around. Romer’s speculation could mean that many business owners will be reluctant to create new jobs and hire additional workers until they see significant changes in the economic climate, which could impede the economy’s growth even further.