U.S. unemployment will increase over the next several months but the pace of the country's economic decline will moderate in the second half of the year, a top Obama economic advisor told Congress on Thursday. Christina Romer, who chairs President Barack Obama's Council of Economic Advisors, forecast another economic contraction in the second quarter of the year and was pessimistic on unemployment. However, Romer was confident that the economic decline would moderate, though she was unsure whether an economic recovery would start this year. “Whether the recovery begins later this year, as most private forecasters predict, or takes a bit longer is hard to know,” she told Congress' Joint Economic Committee. Romer warned that gross domestic product (GDP) would need to grow before unemployment begins to fall. “The recovery will almost surely take a long time,” she said. Romer admitted that current government spending has increased budget deficits and the national debt, but she rejected suggestions that the Obama administration should reduce its stimulus spending next year if the economy starts to recover. “We not only need growth in 2010, we actually need pretty rapid growth to bring the unemployment rate down,” Roemer told lawmakers. “If you think about where we're likely to be in 2010, I don't think anyone's thinking of the economy being robustly healthy.”
