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Mississippi economy in slight rebound after 2 years of recession

By TED CARTER

Several years after Washington declared the Great Recession over, Mississippi continued to endure its consequences, finishing both 2013 and 2014 with a shrinking economy.

That tough stretch appears to be over, with the state’s economic negativity turning positive in the second quarter of 2015, state economists say.

With 2013 and 2014 included, Mississippi has had a deficit in economic growth for four of the last six years, economists at the University Research Center say in the “Mississippi Economic Outlook” summer issue.

» READ MORE: Sustained job growth forecast for Mississippi through 2017

An upturn, though slight, is underway and should be showing some strength in 2017, economists at the University Research Center say in the “Mississippi Economic Outlook” summer issue.

The U.S. Bureau of Economic Analysis said in a preliminary Gross Domestic Product, or GDP, in June that Mississippi’s economy shrank 1.1 percent in 2013 and 1.2 percent in 2014.

What’s more, revised data show the Gross State Product, or GSP, declined 1.1 percent in 2013, the Economic Outlook reported.

The forecast for economic growth in 2015 is 1.3 percent; for 2016 2.2 percent; and for 2017 2.2 percent. “Realization of the 2015 and 2016 forecasts would result in the first consecutive years of expansion in the state’s economy since 2007 and 2008,” the Outlook report says.

Meanwhile, increased retail consumer spending is expected to drive economic growth nationally, and will receive an assist from an improving housing market, the Outlook said, basing its forecast on Bureau of Economic Analysis expectations of 2.2 percent growth in the U.S. GDP.

Annual U.S, real GDP growth is expected to improve to 3.1 percent in 2016 and fall slightly to 2.7 percent in 2017,

The Economic Outlook report said it is at least plausible the Bureau will make an upward revision in its conclusion that Mississippi’s GDP shrank 1.2 percent last year. This could occur by the Bureau accounting for Mississippi income tax withholdings growing nearly twice as fast in 2014 as in 2013.

This “suggests stronger growth than reflected by the BEA data,” the Outlook said.

“I think they should revise that up,” said Corey Miller, an economic analyst with the University Research Center.

The BEA has also been questioned a lot lately over its failure to account for seasonality in its data, Miller said. “The winter was really bad nationwide in 2014 and this year was really bad in the Northwest. Some people think they haven’t done a good enough job accounting for that,” he added.

The bad weather would not have influenced Mississippi’s negative GDP for 2014, according to Miller, who added: “Mississippi just hasn’t bounced back from the /Great Recession like other states have.”

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