Top White House Economic Adviser Says Unemployment Likely To Stay Elevated

Travis Martinez – University of New Mexico/ Talk Radio News Service

White House Council of Economic Advisers Chair Christina Romer testified before a joint economic committee Thursday that although the nation’s economy is moving into “recovery phase,” it is likely that the overall unemployment rate will remain painfully weak through 2010.

“As we [U.S. economy] enter the fourth quarter with the unemployment nearing 10 percent, it is likely to remain severely elevated,” said Romer.

Committee Chairwoman Carolyn Maloney (D-N.Y.) expressed deep concerns for the future of jobs and the labor market. During her opening statement, Maloney said that she can see signs of recovery, but it’s contributing little to no help for the labor market.

“I am deeply concerned about the state of our labor market, as I have been since the start of this recession. GDP growth is of little comfort to the millions who have lost their jobs,” she said.

Romer reminded the committee that analysts have predicted that the Recovery Act will have its greatest impact on economic growth in the second and third quarters of this year. By mid-2010, she explained, fiscal stimulus will likely be contributing little to growth. However, Romer said she believes that the country has survived the low point of the recession, adding that there is concise evidence that the policies implemented by the Obama administration are working.

“If GDP growth for the third quarter is indeed positive, as anticipated, this would be strong evidence that the economic recovery is underway,” said Romer.