State Economy Shrinks But Is Primed For Growth
The Massachusetts economy shrunk during a sluggish final quarter of 2009 but is expected to grow at a steady pace through the first half of this year, according to the University of Massachusetts Donahue Institute's latest MassBenchmarks report.
Researchers estimate that economic activity declined at about a 0.2 percent annualized rate in the fourth quarter of 2009 as the national economy, as measured by the U.S. Bureau of Economic Analysis, grew at a 5.7 percent rate.
Northeastern University economist Allan Clayton-Matthews credits a dismal holiday shopping season and unemployment figures continuing to rise with state's poor economic performance.
However, the state's economy is expected to grow in the first six months of 2010, and the MassBenchmarks leading indicator predicts a 1.1 percent annualized rate of growth until June. That's an increase from the previous quarter's annualized growth rate of 0.5 percent.
Exports are increasing, the technology and labor markets are growing and home sales and prices are increasing, which should help contribute to modest gains, Clayton-Matthews said.
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