Mass. Economy Grows During 2nd Quarter, Downturn Predicted
A recent report says the Massachusetts economy grew by 3-point-3 percent during the second quarter of 2012. The state's gross product also increased at a level twice than the national rate. Still, economists are concerned about an economic slow down during the second half of the year. New England Public Radio's Adam Frenier reports.
The report appears in MassBenchmarks, an economic journal published by the Donahue Institute of the University of Massachusetts. Martin Romitti is the Managing Editor of MassBenchmarks. He said a decline in the unemployment rate along with increased earnings were major factors for the state's economic growth during the second quarter.
"For the year, we had about a three-point-eight percent growth in consumer spending. So we're seeing people, at least in Massachusetts being able to get some job growth, stronger earnings and spending that money as well. That all tied into a pretty solid quarter of economic growth in the state."
Romitti says despite the positive figures from the last three months, economic growth in Massachusetts is predicted to slow over the second half of the year. Romitti says one reason is the impact of Europe's economies on the export of goods from Massachusetts. He says Massachusetts businesses, more than those in other states, depend on the sales of goods to European countries. Romitti says experts are already seeing a decline in this area.
"We saw a drop in the amount of goods Massachusetts businesses have been selling to Europe, so we're starting to see the impact of that. On top of that, you can't expect much with tight state and local budgets and a looming crisis, a "fiscal cliff" they are calling it at the federal level.
Massachusetts economic output increased two-point-two percent in 2011, making it the seventh fastest growing state in the country. For New England Public Radio, I'm Adam Frenier.