The worst of the recession could be over in four months, according to the latest state economic forecast.
In a prelude to releasing new tax income expectations, the Economic and Revenue Forecast Council surveyed Washington’s economic landscape and released its findings Friday.
Top forecaster Arun Raha expects the state to hit bottom in the quarter that runs from July through September.
Although the business statistics might improve, however, the state likely will continue to bleed jobs well into 2010, the report said. It predicted a peak unemployment rate of 10.6 percent.
The state unemployment rate now is 9.1 percent, with 320,000 Washington residents looking for work. That’s double the number from a year ago, but the percentage rate has stabilized month to month for the first time since December 2007. In Thurston County, the unemployment rate is 8 percent.
Other details in the report:
• Consumers with good credit ratings and large businesses are getting loans at reasonable prices, but small businesses continue to struggle finding credit.
• State auto sales appeared to have stabilized but are 40 percent below recent averages.
• Income from the real estate excise tax seems to be stabilizing.
• The year-over-year decline in general tax collections, nearly 15 percent, is the steepest on record.
• The recovery in state revenue is expected to lag behind the overall economic recovery.
The council will release its revenue forecast June 18. That document will give legislators updated information on whether the $4.5 billion in spending cuts they made this year were deep enough.
Gov. Chris Gregoire already has said she expects the next revenue forecast to be negative, as well as the following one in September.
“The question is, When you add them together, they will be how negative?” she said recently. “We’ve got about $500 million in reserve, not including the rainy-day fund. So will that get us through to January? And that’s an open question.”
Adam Wilson: 360-753-1688
The Economic and Revenue Forecast Council’s latest survey report is at www.erfc.wa.gov/pubs.