Massachusetts economic growth expected to slow
The Massachusetts State House
The Massachusetts economy grew at a sharply slower rate in the fourth quarter of 2016 and growth is expected to be slow over the first half of 2017, according to data released on Friday by the University of Massachusetts Donahue Institute.
In its journal MassBenchmarks, which is published in collaboration with the Federal Reserve Bank of Boston, authors wrote that the state economy grew at an annual rate of 0.5 percent in the fourth quarter, down from 3.1 percent in the third quarter. The U.S. economy grew by 3.5 percent in the third quarter and 1.4 percent in the fourth quarter.
The journal projects growth of 0.9 percent and 1 percent in the first and second quarters of 2017, respectively, while adding that economists expect a federal fiscal stimulus package to boost growth later in 2017 or in 2018.
Journal authors said labor force constraints - the state's jobless rate is at a 16-year low - may be hampering growth, but indicators of spending by households and businesses remained strong during the last quarter of 2016.
Citing Bureau of Economic Analysis estimates, the journal's authors said the state economy grew by 1.7 percent in the second quarter of 2016 and contracted by 1.9 percent in the first quarter.
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