Unemployment. Despite big gains in employment, people continue to join the work force in record numbers. As a result, it is doubtful the unemployment rate will fall much below 7 per cent by the end of 1977. But there should be continued strong gains in the number of people with jobs.
Recovery. Because the recovery far from burned itself out last year and because the government will prime the pump with further stimulus, economic growth will continue at a steady pace in 1977. The economy should grow between 4 and 5 per cent even without further stimulus. With a modest tax cut and spending increase, growth probably will be between 5 and 6 per cent. Either rate should reduce the unemployment rate at a steady, albeit undramatic pace.
Prices. The pleasant surprise in 1976 was on the price front, and for at least the first half of 1977, consumer prices should continue to rise at a 4 to 5 per cent rate.
Wages. Slowing inflation and cost-of-living coverage in expiring contracts probably means that wage demands will not increase and could moderate.
Interest rates. Weak demand for funds kept short-term interest rates much lower than expected in 1976. They probably will rise some what this year as demand picks up. Mortgage money should be plentiful.