WASHINGTON – The Bush administration released a new economic forecast for 2005 in which it boosted growth forecasts slightly from a year ago but cut back sharply on its estimates of new jobs.
The administration said the overall economy as measured by the gross domestic product (search) will grow by 3.5 percent next year and 3.4 percent in 2006.
A year ago, the administration was forecasting growth at slightly lower rates of 3.4 percent for 2005 and 3.3 percent for 2006. For the current year, which is almost over, the administration now sees the economy expanding, when measured from the fourth quarter of last year, by 3.9 percent, down from an expectation of 4 percent this time a year ago.
The estimates on job growth were reduced even more sharply. The administration expects payroll (search) employment to average 131.3 million for 2004, down by 1.4 million from the forecast of a monthly average of 132.7 million jobs it made just a year ago.
That would have represented an increase of 2.6 million jobs in 2004, compared to 2003. Now, the administration is predicting that jobs will be up by just 1.4 million this year compared to 2003.
For 2005, the administration is forecasting jobs will average 133.4 million, an increase of 2.1 million jobs from 2004.
Last year's jobs forecast prompted a barrage of criticism from Democrats, who claimed it was overly optimistic.