State economy slows notably in Q3, UMass journal reports
The latest MassBenchmarks bulletin indicates that the Massachusetts state economy grew at a rate of just 1.9 percent during the third quarter of this year, down from the previous quarter’s rate of 4.0 percent and below the U.S economy’s 2.0 percent rate.
State unemployment increased one-half a percentage point during the same quarter, from 6.0 percent in June to 6.5 percent in September.
The slowdown in growth is linked to the Commonwealth’s increasing dependence on Europe as a market for exports. During the third quarter of 2012, demand for information technology, semi-conductors and other software products lagged. The leading index predicts that the Massachusetts gross domestic product will rise slightly to a 2.3 percent rate in the fourth quarter of 2012 and the first quarter of 2013, but expects no net employment growth in the state over the next six months.
Despite the poor recent overall economic performance and the slow outlook for the rest of the year, some knowledge-based and technology sectors continue to do well. Employment in computer systems, consulting, scientific research and development, software, and durable manufacturing have continued to increase despite weaknesses in other sectors of the economy.
MassBenchmarks is published by the University of Massachusetts Donahue Institute in cooperation with the Federal Reserve Bank of Boston.
Read the full bulletin, “State economy slows notably in Q3, UMass journal reports,” (MassBenchmarks, 10/27/12)
October 27, 2012