In the areas that matter most, key indicators point to a significant economic recovery in 2011. As confidence grows among Americans, so will consumerism. Yet as much as the economy may depend on spending, be mindful of the personal goals you have set for yourself this year. If paying down debt and repairing your credit are among them, leave spending to others and keep a tight reign on your own.
The positive economic outlook for 2011 is based on an AP poll of 42 leading economists in the private, corporate and academic sectors. They predict the economy will grow 3.2 percent by the end of the year.
Optimism among economists stems from optimism among Americans encouraged by:
- Extension of income taxes
- Lowering of social security taxes
- Higher stock prices
- Easier access to loans
- Government more sympathetic to businesses
Still, unemployment won’t change much, hovering around 9 percent by the end of the year. Though economists predict the creation of 2.2 million new jobs in 2011, overall the economy simply isn’t growing fast enough to make much of a dent in job growth. That said, if you’re already employed you can rest much easier than you have in months past as we’re already seeing a huge improvement in job security.
Aside from continuing levels of high unemployment, some not-so-sunny predictions for 2011 include:
- Rise in energy prices
- Continuing fall in home prices
- Rising interest rates
Economists polled don’t seem too concerned though, as the positive indicators will far outweigh the negatives in the minds of those who matter most – Americans whose spending drives recovery.
“People will finally recognize that an economic recovery is under way,” says Lynn Reaser of the National Association for Business Economics. “This won’t be a recovery seen only by economists.”
Just be mindful of your own money. There will be no shortage of Americans willing to help spend our way back to economic recovery. Instead of keeping up with the Jones’, why don’t you take this opportunity of improved job security to put more toward paying down debt and stashing away a little extra in savings for a rainy day?