Area economists lay out predictions

The economy is still sliding and recovery is more than a year away, but the fall won’t be painfully deep, predict three prominent local economic forecasters.

After a series of blockbuster bailouts, market gyrations and downbeat job reports, the trio was asked to summarize their view of the short term — roughly six months — and the longer term that would take us through 2010.

They agree that Georgia will track the national flight path. Here is what they expect for the state’s trajectory:

Roger Tutterow, of Mercer University

• Short term: “I think we are going to see the year-to-year numbers go negative. If you look back from December 2008 to December of 2007, you are likely to see a job loss of 25,000 to 35,000.
  

  “We have had job losses in construction, financial services and manufacturing. Over the next six months, that will continue to be the story.
  

  “I think we are well beyond ‘09 before we start to see a lot of nails being pounded again.
  

  “The problem continues to be that Georgia, and particularly metro Atlanta, have an excessive exposure to the real estate market.”

• Long term: “I think things will look a lot better by 2010. Residential real estate will start to grow by then. I think that will start to feel like a normal economy.
  

  “Banking will still be a little bit of a question market. I expect most of the uncertainties to be known by 2009, so that we go into 2010 with stress starting to lessen.
  

  “Financial challenges facing the state government will work through the system … manufacturing job losses will start to moderate.”

Rajeev Dhawan, director of the Economic Forecasting Center at Georgia State University

• Short term: “We are going to see continued declines of spending power in the economy — either because of layoffs or people cutting back.”

• Long term: “Going forward, there will be less credit and less economic activity. Credit is the lifeblood of the economy. But even with the help of the government, the willingness of lenders to make loans has declined. I think it is BYOB — be your own banker.
  

  “I’d say 2010 will be a better year than 2009, but how much better depends on how quickly the financial problems subside.”

Jeffrey Humphreys, director of the Selig Center for Economic Growth at the University of Georgia

• Short term: “I think the U.S. and Georgia GDP will be negative in the fourth quarter this year and the first quarter of next year. Two back-to-back quarters of declining output will end the debate about whether we are in a recession.
• Long Term: “In terms of GDP, it will be a mild recession. By 2010, the housing recession will be over and home prices will be appreciating.
  

  “We’ll have trend growth of about 3 percent nationally, 3.5 percent in Georgia. We’ll start getting some impacts from housing again.”