By Bobby Harrison/NEMS Daily Journal
JACKSON – Economic growth in Mississippi will be even more sluggish than projected national growth, state economist Darrin Webb predicted.
Webb told members of the Legislative Budget Committee on Tuesday he projects economic growth of 0.7 percent for the current year and 1.7 percent for the upcoming fiscal year. That would be below projections of 1.5 percent and 1.9 percent for the nation during the current and upcoming years.
The committee is meeting this week to hear requests from agency heads before developing a budget proposal for the 2012 session. The state economic forecast is important in determining how much revenue will be available.
Lt. Gov. Phil Bryant said the economic outlook is another reason to be cautious in budgeting for the fiscal year that starts July 1. He said during two days of hearings agency heads already have requested more than $800 million above what they received this year.
Webb said the nation experienced growth of 3 percent in 2010 compared to 1.1 percent for the state. He said the “dismal” growth rates lead many economist to fear another recession, though the prevailing thought is that both the state and nation will continue to experience slow growth.
“Over the past 20 years, the state has averaged 2.7 percent growth during expansions,” Webb said. “We do not anticipate that level of growth until perhaps 2014.”
At the height of the economic downturn in February 2010, the state had lost 77,000 jobs from its recent peak of February 2008. As of August, the state was still down 69,000 jobs, or 6 percent, below the February 2008 level.
For the entire decade, Webb said state economic growth would have been almost non-existent if not for rebuilding after Hurricane Katrina in August 2005. He said the state has never surpassed its peak employment numbers in 2000.
“The recession was very deep and this recovery has been incredibly slow and we have a long way to go until we are fully recovered,” Webb said. “So it is natural that it feels like a recession.”