A slow, slow return to growth

@CNNMoney November 8, 2011: 3:24 PM ET

WASHINGTON (CNNMoney) -- After a spate of speed bumps this year, the U.S. economy is starting to pick up the pace -- but the 2.5% growth forecast for 2012 still seems sluggish to most Americans, a U.S. Chamber of Commerce economist said Tuesday.

"The problem is that 2.5% is not fast enough," said Martin Regalia, the chamber's top economist, during a panel discussion at the Chamber's headquarters.

Regalia noted that after a bunch of "one-offs," including political uprisings and the earthquake in Japan that disrupted manufacturing supply chains, "we're kind of getting back" to growth, he said.

But Regalia predicted the U.S. economy won't see unemployment drop below 6% until possibly 2020, adding that driving down the jobless rate from the current 9% to below 6% will take a solid three years of growth between 4.5% to 5%.

The biggest problem remains that $6 trillion in housing wealth is gone, Regalia said. And the housing sector remains a trouble spot for the U.S. economy.

Until that picks up, "the American people are not going to feel like we're in a recovery at all. And of course that creates political problems," he added.

James Meil, chief economist at Eaton Corp., (ETN, Fortune 500) agreed that the economy is picking up. He warned that Europe is currently going through a mild recession, which would continue to drag on the United States growth efforts.

Meil gave the overall U.S. recovery a rating of a "C." But he gave the manufacturing sector a "B plus," saying that sector is in the midst of a "vibrant" recovery, thanks in large part to capital goods. To top of page

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