A Wisconsin economist says the state’s economic recovery will closely mirror what happens at the national level. A great deal of uncertainty remains, according to University of Wisconsin School of Business Dean Michael Knetter. “Certainly a bottom’s been reached, but I would say that this is one of those periods in our economic history where there’s probably more uncertainty about the nature about the nature of this recovery than I’ve seen since I’ve been a practicing economist watching the economy,” Knetter told WisconsinEye.
Knetter said that while Wisconsin certainly hasn’t been the hardest hit state in the recession, there’s also nothing that will really set the state apart from the national economy. “I think Wisconsin, like the rest of the nation is looking at a maybe three percent growth rate in its production side of the economy this year,” Knetter said. “That might be enough to put a dent in the unemployment rate. I expect in the next few months we’ll start to see a turnaround there.”
However Knetter said that’s assuming that we don’t have a “double dip” recession, with another downturn on Wall Street and another increase in joblessness. “There’s not a lot of margin for error left on policy side for us,” Knetter said. “We’re quite overextended in our fiscal and monetary policy, so I’d say it’s a razor thin situation here right now. We’ve got a recovery underway, but it’s been driven by massive stimulus, and I think we’re waiting to see where in the private sector recovery is going to be sustained.”
AUDIO: Knetter w/WisconsinEye’s Jason Fischer AUDIO: Knetter w/WisconsinEye’s Jason Fischer