A leading forecaster for the U.S. labor market is projecting that the economy will create twice as many jobs this year as in 2010, which would be enough to bring the jobless rate below 9%, according to Bloomberg. On Wednesday, Scott Brown, the chief economist at Raymond James & Associates, said that he expects that the unemployment will end the year at 8.6% after creating two million jobs. The forecast is rosier than the average forecast from economists for an unemployment rate of 8.8%, but even with the strong labor recovery, the U.S. would still be far short of pre-recession employment levels.
Brown anticipates, Well see consumer spending remaining pretty strong, although he said he would be watching home prices closely, as further declines could undermine consumer sentiment and spending. Meanwhile, a separate report from Zillow Inc. has shown that the number of homes in the U.S. that are worth less than the outstanding mortgage jumped in the fourth quarter of 2010, rising to 15.7 million or about 27% of all home owners. The median home value dropped 2.6% in the fourth quarter to $175,200, which is 5.9% lower year-over-year and 27% the June 2006 peak value.