One thing various economists have told me over the years in Massachusetts is that the state has a tendency to experience higher highs and lower lows when it comes to economic growth.
It appears that we are on the wrong end of that trend at the moment.
Last Friday, citing a report from MassBenchmarks, State House News Service reported that economic growth in the Bay State was a paltry 0.5 percent in the fourth quarter, nearly a full percentage point less than the already unimpressive national rate.
The Massachusetts rate is down from 3.1 percent in the third quarter of last year.
What’s troubling is that this slowdown is occurring even as unemployment continues to decline, reaching levels not seen in more than 15 years. According to State House News Service, the MassBenchmarks reports cites that the lack of availability of even more workers may in fact be playing a role in the stunted growth.
Add in the fact that Federal Reserve Chairwoman Janet Yellen is on record as predicting that interest rates could be hiked as many as three times this year, and you’ve got a difficult environment in which to pick stocks.
MassBenchmarks forecasts only slightly better growth this quarter — 0.9 percent — and edging up a tad more, to a whole 1 percent, in the second quarter of 2017.
We investors could have our work cut out for us, at least in the near term.
MassBenchmarks is a journal published by the UMass Donahue Institute in collaboration with the Federal Reserve Bank of Boston.