Local economist encouraged with recovery, but remains cautious
WACO, Texas (KWTX) - A Waco economist says the May and June jobs reports show the economy is on the road to recovery but says it’s not out of the woods yet.
“May and June jobs reports were encouraging and reflect the fact that as businesses began to reopen, what was essentially a sound economy before the pandemic responded relatively quickly,” Dr. Ray Perryman, principal at the Waco-based Perryman Group, said in a report that was released Thursday.
But he tempered that good news with a warning.
“However, even with these gains, Texas is still almost 700,000 jobs below a year ago and about 900,000 below the level just before the outbreak began.”
“It should take about two years to return to prior peak levels even with no major additional disruptions,” Perryman said.
“Health and safety remain of paramount concern, and progress will depend on the ability to continue to resume activity without creating an additional spike in infections that will necessitate a new wave of restrictions.”
Perryman also pointed out the results gathered in June are based on surveys completed in the middle of the month before the recent surge in cases, hospitalizations, and deaths in Texas.
He also warned “subsequent measures to control the pandemic (in particular, closing bars again and pulling back on restaurants) will impact the numbers going forward, and initial claims for unemployment have risen recently.
“Further restrictions may prove necessary,” Perryman said.
In all, the state’s real gross product is expected to decline by 5.12% this year on a year-over-year basis, with 6.11% expansion in 2021.
As well, Perryman said, employment is projected to decrease 5.42% through 2020, with recovery of 4.13% next year.
“Current estimates of Texas losses for this year are slightly lower than The Perryman Group’s projections last quarter,” Perryman reported, “but the rate of recovery next year is also likely to be slower than expected last quarter.
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