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Updated: 10:31 p.m. Thursday, July 1, 2010 | Posted: 10:30 p.m. Thursday, July 1, 2010
Staff and wire reports
Fears that the economic recovery is fizzling grew Thursday after reports showed unemployment claims are up, home sales are plunging without government incentives and manufacturing growth is slowing.
Meanwhile, 1.3 million people are without federal jobless benefits now that Congress adjourned for a weeklong Independence Day recess without passing an extension. That number could grow to 3.3 million by the end of the month.
All of this worries economists. As jobless claims grow and benefits shrink, Americans have less money to spend and the economy can’t grow fast enough to create new jobs. Some are afraid the country is on the verge of falling back into a recession.
“One hates to be too pessimistic, but I think it’s a serious problem,” said Robert Premus, Wright State University professor of economics. “I think there’s growing concern that we could double-dip (re-enter a recession). If we did ... there’s a chance we’ll look back five or 10 years from now and say, ‘We just went through a pretty major depression.’ That’s certainly a possibility.”
Premus said Dayton companies could see exports decline if the economy falls backward. Also, “it shows up in high unemployment rates and more people in need of assistance, and we’re already strapped.”
Indicators, though, can bounce back unexpectedly, “so you have to watch this for a while,” Premus said.
Richard Stock, director of the University of Dayton Business Research Group, said he wanted to monitor economic indicators before commenting.
Staff Writer John Nolan and the Associated Press contributed to this report.
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