Shelnutt Predicts Slow Rebound

An economist at the University of Arkansas at Little Rock said he expects a muted recovery for the state’s economy through the first quarter of 2002.

John Shelnutt of UALR’s Institute for Economic Advancement said in his quarterly state economic forecast that the state’s recovery will be quieted by less-than-robust investments in some sectors.

Shelnutt said real personal income growth will take a slow turn to positive territory by the second quarter.

“Signs of recovery in the Arkansas economy are limited as of the first quarter, but anecdotal evidence from surveys of purchasing management and consumer spending indicates a rebound is in the works,” he said in a news release.

Shelnutt said the recovery won’t be strong because most developed countries or economies are in or near recession, which will eliminate exports. That will limit recovery.

“It won’t hold it down to recession levels, like now, but just limit the rate of acceleration,” he said.

Shelnutt also said the overheated investment structure during the last few years will slow new investment and the buildup of inventories that often signals recovery.