Office of Management and Budget says high unemployment rates will last

The numbers that have the White House projecting an unemployment rate dipping below 8 percent before November still show the economy struggling to recover until well after the next presidential election, with rates not expected to stabilize to pre-recession levels until after the second term President Obama is hoping to win.

Republicans quickly leapt on Friday’s Office of Management and Budget report that prediction slower-than-expected economic growth this year and next, with the unemployment rate dropping to 7.9 percent by the fourth quarter. Mitt Romney’s spokeswoman called it the latest evidence of Obama’s failure on the economy, but the full study paints a stark long-term picture as well.

The OMB, in its Mid-Session Review to Congress released Friday, projects unemployment will drop gradually, to 7.7 percent in 2013, 7.3 percent in 2014, 6.7 percent in 2015, 6.2 percent in 2016, 5.7 percent in 2017 and remaining at 5.4 percent from 2018 to 2022. The national unemployment rate was last at 5.4 percent in May 2008, according to Bureau of Labor Statistics data.

The projections are based, the report said, on accelerated economic growth as the country comes out of its recession.

“Unemployment is projected to decline slowly this year and next, because of the moderate pace of expected real GDP growth and because, as labor market conditions improve, workers rejoin the labor force, adding upward pressure on unemployment,” the report said. “With accelerated growth, the unemployment rate is projected to fall more rapidly, eventually stabilizing at 5.4 percent.”…

via OMB report says recession will cost decade of high unemployment rates – POLITICO.com.

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What the report says

Source : FY 2013 Mid-Session Review