December 2, 2010; Source: Politico| Nonprofits are hungry for anything that gives them insight into the economic turbulence coming down the pike. Will 2011 be better than 2010? Much better? A little bit better? And what do we mean by better?
Recently Politico sent its e-newsletter subscribers this Goldman Sachs analysis of the future of the economy that highlights a “brighter” outlook, notably the guess by Goldman economists that the economy is bouncing back better than they expected: “We have raised our sights for US growth in 2011 and expect further acceleration in real GDP in 2012. Specifically, our revised view calls for growth to remain at last quarter’s 2.5% annual rate through early 2011 and then increase over the next year to a 4% annual rate. On an annual average basis, we now expect real GDP to increase 2.7% (annual average basis) in 2011, versus 2.0% previously, and to increase 3.6% in 2012.”
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The practitioners of the dismal science often see improvements in numbers that are difficult to discern in people’s everyday lives. Their positive take on the trajectory of the economy means that “we now expect the jobless rate to fall to about 8½% by year-end 2012 . . . Most of this decline occurs in 2012; over the four quarters of 2011 we expect only a marginal reduction from the current 9.6% rate, to about 9¼%.”
For nonprofits on the front lines of fighting the effects of the Great Recession, having nearly one out of ten members of the labor force unemployed through 2011 and into 2012, particularly with the likely Congressional rollback of extended unemployment benefits, means that too many families will continue to lose their homes to foreclosure, find themselves without health insurance coverage (regardless of health care reform), and be dependent on nonprofits to knit together the tattered safety net of programs and services that keep families whole.—Rick Cohen