Unemployment in the United States will top 10 per cent this year, according to the latest forecast from the U.S. Federal Reserve.
On the bright side, the Fed expects the economy will only shrink between one and 1.5 per cent instead of 1.3 to two per cent as predicted in May.
The first half of 2009 wasn't as bad as predicted, leading to the rosier forecast for the rest of the year. The Fed even predicts the economy will start growing in the second half of the year, however, the pace will be slow.
While the economy might be slightly healthier, the unemployment rate hit a 26-year high of 9.5 per cent in June and the Fed is now forecasting the jobless rate could reach 10.1 per cent by the end of the year instead of the original prediction of 9.6 per cent
For 2010, the Fed predicted the economy would grow between 2.1 and 3.3 per cent, slightly better than the original forecast of between two and three per cent.
It could take five or six years for the economy and the labour market to get back on track, according to the forecast.
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